Another RBA rate rise isn’t guaranteed, but Australian homeowners may be better off preparing for the possibility rather than simply hoping rates won’t increase again.
Heading into the Reserve Bank of Australia’s September meeting, the cash rate sits at 4.35% after three increases during 2026.
The RBA increased the cash rate by 0.25 percentage points in February, March and May, a combined increase of 0.75 percentage points since the beginning of the year. It then held the cash rate steady at its June and August meetings. Reserve Bank of Australia
With inflation still too high, borrowers shouldn’t necessarily assume the interest rate cycle is finished.
The good news is that you don’t have to predict exactly what the RBA will do next to prepare your finances for it.
Why Could the RBA Raise Interest Rates Again?
The main issue remains inflation.
At its August meeting, the RBA said inflation remained too high and underlying inflation was still elevated. It also noted that higher interest rates were expected to slow spending further as their full effect flowed through the economy. Reserve Bank of Australia
ABS figures subsequently showed trimmed mean inflation at 3.6% in the 12 months to July 2026, unchanged from June and above the RBA’s 2–3% inflation target. Australian Bureau of Statistics
The RBA’s August forecasts didn’t expect inflation to return to the middle of its target range until early 2028. Reserve Bank of Australia
That doesn’t mean another rate rise will happen.
But it does mean borrowers shouldn’t assume that the next move in interest rates will necessarily be down.
When Is the Next RBA Interest Rate Decision?
The RBA’s next Monetary Policy Board meeting is scheduled for 28–29 September 2026, with the interest rate decision due on 29 September.
The following meeting is scheduled for 2–3 November, followed by another on 7–8 December. Reserve Bank of Australia
Rather than spending the days before each meeting trying to predict the decision, homeowners can use the time to make sure their finances are prepared for different outcomes.
How to Prepare for Another RBA Rate Rise
If another rate increase would put pressure on your household budget, there are several things you can consider doing before it happens.
1. Stress-Test Your Mortgage Repayments
Start by working out what your repayments could look like if your home loan interest rate increased again.
Don’t just look at today’s minimum repayment.
Calculate what your budget might look like if your mortgage rate increased by another 0.25 percentage points, and potentially a little more.
The aim isn’t to predict the RBA’s next move. It’s to find out how much breathing room you currently have.
If the higher repayment would make your household budget uncomfortable, knowing that now gives you time to make adjustments.
2. Build a Bigger Cash Buffer
An emergency fund can become particularly valuable when mortgage repayments and other household costs are elevated.
How much you need will depend on your circumstances, but having accessible savings can help cover unexpected expenses without immediately turning to credit.
If you have an eligible offset account, keeping your emergency savings there may have an additional benefit.
Money held in a correctly linked 100% offset account generally reduces the portion of your home loan balance on which interest is calculated while keeping the money accessible.
3. Check Whether Your Home Loan Rate Is Still Competitive
After several RBA rate increases, it’s worth checking the actual interest rate you’re paying rather than assuming your lender remains competitive.
Your current lender may have other products available, or another lender may offer an alternative that better suits your circumstances.
However, the lowest advertised rate isn’t automatically the best home loan.
Fees, offset facilities, redraw, loan features, remaining loan term and refinancing costs all need to be considered.
A home loan review can help establish whether your existing mortgage still stacks up.
4. Use Your Offset or Redraw Strategically
If your home loan includes an offset account or redraw facility, understanding how it works can become increasingly valuable when interest rates are high.
An offset account can potentially reduce the balance used to calculate your mortgage interest.
Redraw, meanwhile, may allow you to access eligible additional repayments you’ve previously made, subject to your lender’s terms and conditions.
They’re not the same thing, so it’s important to understand the rules that apply to your particular loan.
5. Look at Discretionary Spending Before You Need To
Nobody particularly enjoys being told to “cut back”, especially after several years of cost-of-living pressure.
But reviewing discretionary expenses before your budget becomes stretched gives you more control over the decisions you make.
Subscriptions, memberships, takeaway spending, insurance, utilities and other recurring expenses can quietly accumulate.
You don’t necessarily need to launch a scorched-earth campaign against every coffee and streaming service.
The aim is simply to identify expenses you’d be comfortable reducing if your mortgage repayment increased again.
Should You Make Extra Mortgage Repayments Before Rates Rise?
Making additional repayments can help reduce your loan balance and potentially reduce the amount of interest you pay over time.
But directing every spare dollar into your mortgage isn’t necessarily appropriate.
Maintaining an adequate emergency buffer matters too.
If your loan has an offset account, you may be able to keep additional cash accessible while still reducing the amount of mortgage interest calculated, depending on your loan structure.
Before making significant additional repayments, particularly on a fixed-rate loan, check whether your lender imposes limits or fees.
What Should Home Buyers Do if Interest Rates Could Rise?
Prospective buyers should also consider the possibility of higher rates.
When working out how much you can afford, don’t base the decision solely on the repayment attached to today’s advertised interest rate.
Consider calculating repayments at a somewhat higher rate as well.
Ask yourself a simple question:
Would I still be comfortable with this mortgage if rates increased again?
That can be a much more useful number than simply knowing the maximum amount a lender may be prepared to lend.
Borrowing Capacity Isn’t the Same as a Comfortable Budget
Your borrowing capacity is determined by a lender using its assessment criteria, including your income, debts, expenses and other financial commitments.
But the maximum amount you’re eligible to borrow isn’t necessarily the amount you should borrow.
Your own budget needs to account for the life you want to live alongside the mortgage.
Leaving some room for unexpected expenses and potential future rate changes can help prevent a home loan from consuming more of the household budget than anticipated.
Should You Refinance Before Another RBA Rate Rise?
Possibly, but an expected RBA decision shouldn’t be the sole reason to refinance.
Instead, consider whether your current home loan remains competitive based on the information available today.
Compare your interest rate, fees, loan features and structure with alternative options.
If another lender offers a lower rate, calculate the potential saving after taking refinancing costs and the loan term into account.
And remember that refinancing generally requires a new loan application, so eligibility and borrowing capacity matter.
What Happens if the RBA Doesn’t Raise Rates?
Preparing for a rate rise doesn’t mean the preparation is wasted if rates remain unchanged.
A stronger cash buffer, better understanding of your household budget and a more competitive home loan can still leave you in a better financial position.
That’s really the point.
Preparing for higher rates is about resilience, not prediction.
Prepare Your Home Loan Before the Next RBA Decision
No one knows with certainty what the RBA will decide at its next meeting.
What homeowners can control is how prepared they are.
Stress-testing your repayments, building a buffer, using your loan features effectively and checking whether your interest rate remains competitive can help you understand where you stand before rates move again.
At Home Loans Australia, we can review your existing mortgage and help you understand how different interest rates could affect your repayments. Contact us now: https://homeloansoz.com.au/contact/
If you’re planning to buy, we can also help establish your borrowing position and compare home loan options before you start making offers.
You can’t control the next RBA decision. You can make sure your home loan is better prepared for it.
Frequently Asked Questions
What is the RBA cash rate before the September 2026 meeting?
The cash rate is 4.35% heading into the RBA’s 28–29 September 2026 Monetary Policy Board meeting. It reached that level after three 0.25 percentage point increases earlier in 2026. Reserve Bank of Australia
How much has the RBA raised interest rates in 2026?
Before the September meeting, the RBA has increased the cash rate three times in 2026, by 0.25 percentage points in February, March and May. That’s a combined increase of 0.75 percentage points. Reserve Bank of Australia
When is the next RBA interest rate decision?
The September Monetary Policy Board meeting is scheduled for 28–29 September 2026, with the decision announced on 29 September. The following meeting is scheduled for 2–3 November. Reserve Bank of Australia
Will the RBA raise interest rates again?
There is no certainty about future RBA decisions. The RBA considers inflation, economic activity, employment, financial conditions and other economic data when setting the cash rate. Its August statement said inflation remained too high. Reserve Bank of Australia
How can I prepare my mortgage for another interest rate rise?
You can consider stress-testing repayments at a higher interest rate, building an emergency buffer, reviewing your current home loan rate and making effective use of offset or redraw features where appropriate.
Should I refinance before the next RBA meeting?
You don’t necessarily need to wait for an RBA meeting to review your mortgage. Whether refinancing makes sense depends on your existing rate, loan features, fees, refinancing costs, borrowing capacity and available alternatives.
Should home buyers calculate repayments at a higher interest rate?
It can be useful. Testing your prospective mortgage at a higher rate can show whether repayments would remain comfortable if interest rates increased after you purchased.
