Here’s what to do when your fixed rate ends

The expiry of a fixed rate term on a home loan isn't always a bad thing. It offers you with a choice: 

1. Allow your home loan rate to revert to the aptly named revert rate

2. Negotiate for a particular variable rate

3. Refinance your home loan

4. Choose a new fixed rate option

Option 1: Do nothing and cop the revert rate

If you do nothing, your home loan rate will probably automatically revert to your lender's default variable rate.

This 'revert rate' is usually higher than the lender's advertised variable rates, and often much higher than your original fixed rate.

It's rarely the most cost-effective choice - so it's worth exploring your options.

Option 2: Negotiate with your lender

Most lenders are open to negotiation - especially if you're a borrower with a strong repayment history.

A simple phone call could land you a better deal.

After all, a customer retained is better than one lost. Your lender earns nothing if you refinance elsewhere. Even a reduced rate is likely still a win for it and a saving for you.

However, you might need to bluff your way to a discount.

Don't be afraid to say you're planning to refinance your home loan - perhaps even research a few options you could refinance too so your lender believes you're serious. The potential loss of your business could tip the scales in your favor.

Option 3: Refinance your home loan

If your current lender won't budge, or if you've found a better deal elsewhere, refinancing could be worth it.

Benefits of refinancing include:

• Lower interest rates

• Access to money-saving features (like offset accounts)

• The option to increase the size of your mortgage or recast your loan term

Refinancing means replacing your current home loan with a new one - potentially with lower rates, different terms, or better features.

There are fees involved with refinancing, but the long-term savings often outweigh them. Still, it pays to do the math.

If you're considering refinancing your home loan, here are some of the most competitive variable mortgage rates on the market now:

Important Information and Comparison Rate Warning

Option 4: Fix your rate again

The final option open to those rolling off a fixed rate period is to secure a new fixed rate.

If financial certainty is still important to you, re-fixing your rate could be a smart move - especially if you expect rates to rise again.

If you want to enter into another fixed rate period, now's the time to shop around. In fact, you can follow the above steps to negotiate a lower fixed rate with your lender or refinance to another lender's fixed rate - the choice is yours.

You could even choose to go down the split rate path, fixing the rate on part of your mortgage while you realise a variable rate on the remaining portion. This approach can offer the best of both worlds - some repayment stability, and some flexibility.

Considering a fixed rate home loan? Check out these low-rate options:

Important Information and Comparison Rate Warning

Is it possible to extend a fixed rate period?

Generally, no. Once your fixed term expires, the agreement ends and your loan reverts to a variable rate unless you actively choose to fix it again.

You may be offered a new fixed rate term, but it'll reflect current market conditions, which may be significantly different from when you first locked in.

What happens when interest rates have increased during a fixed period?

If rates have gone up during your fixed period, you might be facing the 'fixed rate cliff' - a sudden and significant jump in repayments.

In this case, preparation is key.

Start comparing rates before your fixed term ends. Even a small reduction on your revert rate can save you thousands over the life of the loan.

_{Article originally written in 2018 and updated by Hanan Dervisevic in 2022. Last updated by Brooke Cooper in 2025.}

_{Image by wirestock on Freepik}