How to free up cash by lowering your home loan repayment

The RBA’s official cash rate is one factor that determines a bank’s home loan interest rates.
As rates have decreased three times in the last 12 months, you could be eligible to reduce your home loan payment.
If you're paying via direct debit, managing your repayments is easy via NetBank or the CommBank app.

The RBA has dropped interest rates for the third time in 12 months. That means that if you're paying down an $800,000 home loan, you could stand to free up $385 a month compared to what you were paying at the start of the year*.

If you're looking to pay down your home loan as fast as possible, you don't need take any action—CommBank won't make any changes to your direct debit if your minimum repayment has decreased.

However, there are many great reasons that you might be looking to free up your cash flow and re-prioritise your spending elsewhere. You could be looking to redirect some money toward your savings, put some money towards alternative investments, or simply free up some cash to pay down other debts.

Consider reducing your home loan repayment

When rates drop, if you have a direct debit set up, you have the option to consider reducing this. You can easily make the change in the CommBank app or Netbank the day following the rate effective date.

Manage your home loan repayments online

Find out how

Make use of an offset account

An offset account is the same as an everyday account, but it's linked to your home loan, and works to reduce the amount you pay in interest on your home loan. This can be an effective way of keeping cash at hand, whilst still working towards paying down your home loan sooner. You can also use your debit card to make payments and transfer money in and out of it.

Consider an Everyday Offset Account

Find out more

Need to know more about home loan repayments?

Things you should know

*Based on a Standard Variable Rate of 5.59% and <60% LVR principal and interest owner occupier 30-year home loan. Rates and figures for illustration only, your interest rate may differ. This guide is information only and should not be relied on as financial advice.

CommBank does not make any predictions about the future direction of interest rates. This article is intended to provide general information of an educational nature only. It does not have regard to the financial situation or needs of any reader and must not be relied upon as financial product advice. As this information has been prepared without considering your objectives, financial situation or needs. You should, before acting on this, consider the appropriateness to your circumstances.

The target market for this product can be found within the product’s Target Market Determination, available at commbank.com.au/tmd