Home loan customers are being warned of fixed-rate deals because of the high revert rates once the fixed term expires. Picture: Supplied

While some of the best fixed-rate deals are in the mid-three per cent range, once the fixed-rate period ends many interest rates revert to much high deals that sting customers.

Home loan customers are being urged to take notice when their fixed rate loan term expires as they are likely to get stung with higher costs. Picture: SuppliedSource:Supplied

In some cases the revert rates can be almost two per cent higher than the fixed rate charge, analysis by financial comparison RateCity has revealed.

The Reserve Bank of Australia board will have their Melbourne Cup meeting to decide if the cash rate will move but experts are predicting new Governor Philip Lowe will keep it on hold at 1.5 per cent.

RBA governor Philip Lowe is expected to keep the cash rate on hold at 1.5 per cent. Picture: SuppliedSource:AAP

Home Loan Experts’ managing director Otto Dargan warns customers to be on top of their fixed rate terms and to understand these rock-bottom deals don’t last forever.

“Where the banks really screw people is when the fixed rate expires because at that time customers are less interested in their home loan,’’ he said.

“And then they either refix on whatever rate the bank tells them is available or they revert to a variable rate that is no longer competitive.

“The variable rate might only get a 0.7 or 0.8 per cent discount and the banks hope that the customers don’t notice.”

On a typical $300,000 30-year home loan, at the end of some fixed rate terms the interest rates can jump by up to nearly two per cent and slug customers about $300 extra per month.

Many home loan variable and fixed-rate deals are well below the four per cent mark. Picture: SuppliedSource:istock

One of the nation’s largest lenders, National Australia Bank, has continued to drop it’s fixed rates and now all one, two, three and four-year fixed deals are below the four per cent mark.

A bank spokeswoman said, “We proactively contact our customers as they approach the end of their fixed terms — via letter and phone — to discuss their home loans to ensure they have the home loan that best suits their needs.’’

HSBC chief economist Paul Bloxham expects the cash rate to stay and hold and there to be no rate changes in 2017.

Inflation figures released last week show the consumer price index rose by 0.7 per cent in the September quarter, lifting the inflation rate from 1 per cent to 1.3 per cent which the chance of a cut today.

sophie.elsworth@news.com.au