The Reserve Bank of Australia (RBA) is expected to raise the cash rate from 3.6% to 3.85% this Tuesday. But most of the 3.3 million Australian homeowners with mortgages will not see their monthly repayments go up. Financial markets and economists say this will be the shortest and shallowest interest rate rise cycle in recent memory since inflation surged last year. Banks cut rates three times last year. However, for most customers of three of the four big banks, lower rates did not automatically lower their home loan payments. National Australia Bank says eight out of 10 of its variable mortgage borrowers did not reduce their payments after last year’s rate cuts. At Commonwealth Bank, this share was between 85% and 90%. Sally Tindall from Canstar said, "Lots of people are paying extra on their home loans, which means their direct debits haven’t moved since January 2025. What that will mean is they are in a great position to tackle a rate hike. Their monthly repayment won’t increase unless they intervene." She added that higher interest will still affect how fast loans are paid off but "it won’t impact their day-to-day budget." Westpac and Macquarie are the only big banks that automatically reduce borrowers' direct debit payments after a rate cut if the customer pays the minimum amount. Jonathan Kearns, chief economist at Challenger and former RBA official, notes the focus on rising repayments misses how mortgage offset accounts protect borrowers. "That is good for homeowners to manage their cashflow and makes that aspect less impactful," he said. Kearns also explained that RBA rate changes affect the economy beyond mortgage repayments, including home prices, currency value, and spending habits. Those who paid the minimum on their loans last year will face higher repayments following Tuesday’s expected rate rise. They must prepare for possible further increases. Tindall advises homeowners facing financial stress to "wargame what a further rate hike or more would mean for the family finances" and seek help from financial counselling services or the free national debt helpline. "The sooner you reach out to them, or indeed to the bank, the more they can help you."