Preparing for Interest Rate Cuts in 2025: Smart Moves to Take

The Reserve Bank of Australia (RBA) has cut rates for the first time since 2020, but several banks have yet to pass on cuts. The RBA interest rate cuts in 2025 can provide relief for borrowers and stimulate the property market. If you’re a homeowner or property investor, this presents a golden opportunity to reassess your finances. You can capitalise on home loan refinancing options as more lenders will likely drop their rates. 

At Deltos Finance, Hobart’s leading mortgage broking company, we specialise in guiding clients through Australia’s ever-changing financial and lending landscape. We’re here to ensure they secure the best home loan refinancing options. So, if you’re wondering how to position yourself for the RBA rate cuts, our team is here to help. For starters, here’s what you need to know to prepare yourself for these interest rate cuts. 

Why Interest Rate Cuts Matter

The RBA interest rate cuts impact borrowing costs across the board, lowering repayments on variable-rate home loans and making mortgage refinancing more attractive. Homeowners can leverage interest rate cuts in 2025 to reduce their mortgage repayments or refinance to secure a better deal when rates drop.

The big four banks quickly announced they would implement the full 25-point reduction by RBA, but about two-thirds of Australian banks and lenders have yet to follow suit. If your bank hasn’t passed on the cuts to its customers, it’s time to prepare for the upcoming changes and make strategic financial decisions to secure the best financial deals that will benefit you in a long time.

Smart Moves to Prepare for Interest Rate Cuts in 2025

1. Review Your Current Home Loan

If you’ve had your mortgage for several years, chances are there are better deals available at the moment. Start by checking lenders (or let expert mortgage brokers shop on your behalf) who have already passed on the RBA interest rate cuts to their customers. Home loan refinancing in a low-rate environment allows you to secure a lower interest rate, reduce monthly repayments, and potentially shorten your loan term.

2. Consider Fixing Your Rate – or Staying Variable

With the RBA rate cuts, variable rates may become more attractive to you on the market. However, if you prefer predictability, locking in a competitive fixed rate before rates rise again could be beneficial. Consulting with an experienced mortgage broker at a trusted company like Deltos Finance can help you determine the right approach for your situation that navigates your right choice at the changing time.

3. Refinance to Reduce Loan Costs

When rates drop, the best home loan refinancing options become even more appealing. By refinancing, you can:

• Secure a lower interest rate
• Access better loan features
• Reduce repayment amounts
• Consolidate debt at a lower cost

Overall, you can reduce your overall loan costs. Plus, if you have usable equity, you can refinance your existing mortgage and receive the equity in cash. You can use that cash for any purpose, such as funding home renovations or paying a deposit for a new investment property.

4. Increase Your Repayments While Rates Are Low

One of the smartest ways to take advantage of the RBA interest rate cuts in 2025 is to continue making the same repayments even if your required minimum falls. This way, you can pay off your loan faster and save on long-term interest costs. Just ensure your lender allows you to do so without incurring any fee. 

5. Leverage Equity for Future Investments

Lower rates can also mean greater borrowing power. As mentioned, if you plan to purchase an investment property or renovate your holiday rental, RBA interest rate cuts in 2025 could provide the perfect opportunity to use your home’s equity for wealth-building strategies.

6. Monitor the Market & Be Ready to Act

Interest rate cuts can lead to increased activity in the housing market, making it essential to stay informed of market changes and quickly act when opportunities arise. By working with a mortgage broker, you can:

• Stay updated on lender interest rate movements
• Identify the best time to refinance or purchase property
• Get pre-approval for loans to move quickly when necessary

Why Work with Deltos Finance?

Navigating home loan refinancing and understanding the impact of interest rate cuts in 2025 can be complex. At Deltos Finance, our expert mortgage brokers work closely with clients to:

• Compare competitive refinancing offers
• Negotiate better loan terms
• Guide you through the refinancing process from start to finish

As Hobart’s trusted mortgage specialists, we ensure you make informed decisions that align with your current circumstances and financial goals. If you live in nearby suburbs, we can cater to you, too. Our mortgage brokers in Richmond, Launceston, Devonport, Carlton, and Beaconsfield are ready to point you in the right direction. 

Additional Benefits of Working with a Mortgage Broker

• Access to exclusive loan products and rates
• Expert knowledge of lender policies and approval criteria
• Personalised strategies to help you maximise savings
• Hassle-free application process and paperwork management

Prepare for RBA Rate Cuts with Expert Advice

With the recent RBA interest rate cuts, now is the time to take control of your mortgage strategy. Considering home loan refinancing or simply want to optimise your current loan? Deltos Finance can help you make the most of these upcoming changes.

Get in touch today to discuss your options and prepare for a financially savvy 2025.