First of the major banks has announced it will pass on rate hike to Australians

Within hours of the RBA announcing a rate rise, the major banks have begun passing on the mortgage pain to their customers.

On Tuesday, the Reserve Bank lifted interest rates by 25 basis points following its first meeting of 2026.

The official cash rate is now 3.85 per cent, back to where it was in July 2025.

The Commonwealth Bank – the country’s biggest residential property lender – was the first to announce it would pass on the interest rate hike to customers, with mortgage rates starting effective from February 13.

“Following the Reserve Bank of Australia’s decision to increase the official cash rate by 0.25 per cent per annum, CBA will increase home loan variable interest rates by 0.25 per cent per annum,” the bank said in a statement.

Angus Sullivan, CBA’s group executive, retail banking, urged customers to take advantage of the support it had on offer.

“We know that interest rate changes can create additional pressure for our home loan customers, which is why we’re focused on providing support and helping them stay in control of their finances,” he said.

“Customers can access a range of tools and support, including through the CommBank app, by speaking with a lending specialist, or by using tools such as the digital home loan repayment calculator to explore options. “

Canstar data insights director Sally Tindall says the latest lift in rates could make loans under 5 per cent extinct.

“There are now just six lenders offering fixed rates under 5 per cent,” she said.

“A February hike would almost certainly close the door on the last remaining options.”

For a typical owner-occupier with a $600,000 mortgage Tuesday’s rate hike will add $90 a month to their repayments.

“While plenty of borrowers will be able to cop this on the chin, it comes on the back of an uptick in the cost of essentials such as food and the end of the electricity rebates,” she said.

“It could be the tipping point for those households already running on tight budgets.”

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Ms Tindall urged customers to not just “accept” a rate cut, urging customers to negotiate with their bank and look to reassess their payment options.

“If you haven’t hit them up in the last six months, then it’s time to do it again, particularly if you’re paying an above-average variable rate, which at this point, as an owner-occupier, is above 5.52 per cent,” she said.

“A 10-minute phone call could be enough to duck the rate pain.”