From now until the end of the month banks will be notifying their customers they have less to pay on their mortgage repayments.

Key points: Analysts say some banks may not pass a rate cut onto all of their variable mortgages

Analysts say some banks may not pass a rate cut onto all of their variable mortgages Discount mortgage rates paid by most borrowers are already well below standard variable mortgage rates

Discount mortgage rates paid by most borrowers are already well below standard variable mortgage rates Some of the big four rate cuts take effect this week, others are nearly a fortnight away

However, even if your bank has publicly promised to pass on this month's Reserve Bank rate cut, it may not automatically apply to you.

A recent Australian Competition and Consumer Commission (ACCC) report found the customer experience often differs from what the banks appear to promise in their media releases.

Consumer advocates are urging borrowers to call their bank manager to ask whether or not they are entitled to a rate cut and, if you are, to ask for an even bigger discount than is on offer.

"It does pay to examine your particular situation and not rely on these media releases and media reporting about what the big banks are doing," said Gerard Brody from the Consumer Action Law Centre.

"The ACCC found there is opaque discretionary pricing in the mortgage market and that most people are not on the relevant headline interest rates that the banks advertise."

That can be a good thing, with the majority of borrowers on rates well below what banks call their "standard variable rate" (SVR) — May figures from the Reserve Bank showed a 0.69 percentage point difference between the average standard and discounted rates.

'Go check' your mortgage rate

The principal of financial research firm Digital Finance Analytics, Martin North, explained that if you are not paying the advertised standard variable rate or you are already on a discounted rate the latest Reserve Bank rate cut may not apply to you at all.

"Certainly the advertised headline rate will be dropping 25 basis points [or 0.25 per cent], but that may not translate in real life to real accounts," he warned.

"You need to go look, go check."

The Australian Banking Association's chief executive Anna Bligh echoed that advice, telling the ABC that individual banks had to weigh up a range of factors in setting various mortgage rates, including the effect on savers of cutting deposit rates.

"Interest rates are at historic lows and competition between banks for the business of Australian customers remains at an all-time high," she said in a statement.

"With the market for home loans so fiercely competitive, Australian bank customers should talk to their bank and shop around to ensure they get the best rate possible."

Mr North's most recent surveys show customers are anxious about whether or not they will receive a rate cut from their bank.

For some, automated payments may delay the benefits of a rate cut, while others on a fixed rate will miss out entirely.

"In some cases it might be automatic, you just can't assume that it will be," Mr North explained.

"I'm particularly concerned with those who have taken out a fixed rate, for example, because they won't see any change.

"They might think they would, but of course with a fixed rate it's a contract until the next term rolls over.

"Other people who have just recently taken out these really cheap loans may discover that they can't get another 25 basis points off their already cheap loan.

"So it is more complex than perhaps it first appears."

Banks quicker to raise rates

Of course in better economic times, when the Reserve Bank was applying the brakes to the economy and raising interest rates, history shows the big banks were very quick to pass on higher rates to borrowers.

According to interest rate comparison website Mozo, when rates last went up in November 2010 the Commonwealth Bank pushed through the hike in just two days.

On the other hand, when it comes to cutting interest rates things can take a bit longer.

"I think that is the case this time where some of the big banks have announced that their changes, their cuts in interest rates, will not happen until later on in June," Mr Brody said.

That is the case for CBA — it will be the last major bank to pass on financial relief to its customers.

"There a number factors that determine the effective date for different products," A Commonwealth Bank spokesperson told the ABC.

"Our home loans are complex products and it does take time for us to update interest rates."

However, the spokesperson also confirmed that the announced 25-basis-point rate cut will apply to all of CBA's variable home loan products.

Major bank principal and interest standard variable rates



Bank Cut New rate Effective from NAB -0.25% 5.11% 14/6/19 ANZ -0.18% 5.18% 14/6/19 Westpac -0.20% 5.18% 18/6/19 Commonwealth -0.25% 5.12% 25/6/19

That financial relief for customers, in many cases, can be quite substantial.

Savings on many of the big four banks' owner-occupier principal and interest loans will range from $44 to $62 a month, based on a mortgage of $400,000 paid over 30 years.

You may have to shift bank to get a better deal

However, despite some customers' best efforts, calling their bank and asking for a better deal may come to nothing.

Bank customer Kate (not her real name) noticed her bank did not have the most competitive mortgage products.

She decided to call her bank manager to ask for a better deal.

"We noticed there were a lot of [banks] reporting lower rates, so we contacted out bank and asked them to at least match it, or lower our rate, and they didn't," she said.

"They were actually quite unhelpful, to tell you the truth, which was actually quite surprising because we've had two home loans with them now.

"We said, 'look can you at least offer us something reduced, to get closer so we don't have to change', and they said 'no no, we can't do anything'."

Gabriella Margerison has been with the Commonwealth Bank for 10 years.

She tried her luck asking for an even bigger rate cut than the 0.25 percentage points the CBA had already announced it would pass on.

"With the [Reserve Bank] rate cut, just sort of pushed me to look what was happening online," she told PM.

"I saw that I was paying a lot more than [if I was with] some of the smaller banks.

"So I thought even though they've given a cut, it's still a fair bit higher than the others, so I called them up.

"I asked them if they would match, or lower even further [than the 0.25 per cent already promised], and they said, 'no, we're able to pass on the 0.25 but nothing else.'

"I'm now seriously considering changing to one of the online lenders."

Kate said she and her partner have now moved banks and the savings they now expect to receive will make a huge difference to their budget.

"Yeah, it is important, actually," she said.

"Also I think if they don't pass it on then our business is not that important to them, so I'd rather take my business elsewhere."