41 Lenders Lift Variable Rates Post-RBA Hike — What Non-Bank Borrowers Should Know

In the immediate wake of the Reserve Bank of Australia's May 2026 cash rate decision, 41 lenders—including all four major banks—have moved to lift variable mortgage rates across hundreds of owner-occupier and investor products. The coordinated rate rise underscores the sustained pressure that high rates are placing on Australian borrowers.

What's Happening

According to Australian Broker, 41 lenders have lifted variable rates following the May RBA decision, affecting both owner-occupier and investment mortgage products. The Big Four—Commonwealth Bank, ANZ, Westpac, and NAB—are among those raising rates, with changes flowing through across principal-and-interest and interest-only loan categories.

Meanwhile, Macquarie Bank has separately scrapped negative gearing add-backs for investor borrowers, further tightening credit conditions for property investors.

Why This Matters for Borrowers

When 41 lenders move in lockstep, the impact is significant:

• Reduced borrowing capacity: Higher variable rates directly reduce how much a bank will lend. APRA requires lenders to assess serviceability at the current rate plus a 3% buffer.
• Investment property squeeze: Investors who relied on negative gearing income to boost their borrowing capacity face a double blow—higher rates and reduced add-backs.
• Refinancing pressure: Existing variable-rate borrowers face higher repayments with limited refinancing options if their employment or income has changed since the original loan.

Non-Bank Lenders: A Different Approach

Non-bank lenders like MPFG Capital operate independently from the APRA framework that governs major bank rate settings. This means:

• Independent pricing decisions: Non-bank rates aren't automatically tied to RBA cash rate movements in the same way as the Big Four
• Alt Doc flexibility: Self-employed borrowers can qualify using BAS statements or accountant letters rather than ATO tax returns
• Investor lending remains available: MPFG assesses investor applications on overall financial profile, not just negative gearing add-backs
• Faster credit decisions: Without the layers of major bank bureaucracy, approvals can move more quickly

Action Steps for Borrowers

1. Review your current variable rate and check when it last changed
2. Recalculate your serviceability at current rates versus 12 months ago
3. If you're self-employed or have non-standard income, enquire with a non-bank lender before assuming you don't qualify
4. Consider whether fixing part of your loan provides certainty in the current environment

The current rate environment rewards borrowers who explore all their options—not just the institutions lifting rates in unison.

This article is for informational purposes only and does not constitute financial advice. Lending products are subject to credit assessment and lender approval.