The RBA lowered the cash rate by 25 basis points to 3.60 per cent at its August meeting and most lenders have passed this on to variable borrowers. (Source: AAP)

Two Aussie lenders have revealed they won’t be passing on the Reserve Bank of Australia’s (RBA) August interest rate cut in full to all borrowers. Most lenders have passed on every one of the RBA’s three cuts this year, but there are some big exceptions.

Aussie Home Loans, one of Australia’s biggest mortgage broking groups, has confirmed it will not pass on the 25 basis point cut in full to its Select home loan customers. From Tuesday, it will drop rates by a smaller 10 basis points on the product, which is one of four the group offers.

A spokesperson from parent group Lendi told Yahoo Finance the 10 basis point rate cut “keeps it in a competitive position for customers”.

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“We’ve fought hard to pass on all rate cuts in full this year, because we know it provides important mortgage relief for customers,” the Lendi Group spokesperson said.

“Following the RBA’s August decision, Aussie will again decrease home loan variable interest rates for customers by 0.25 per cent for the three of our four lending products.”

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Credit Union SA is the other lender that isn’t passing on the cut to all borrowers. While it is passing it on in full for owner-occupied mortgages, it said a small number of investors would not receive the full cut.

Only about 32 of the lender’s 7,500 loans will not receive the full 25 basis point cut, but may receive some level of reduction.

Aussie Home Loans did not share how many borrowers would be impacted by the smaller Select home loan reduction.

For a borrower with a $600,000 mortgage, the full 25 basis point cut would see their minimum monthly repaymetnrs drop by $89.

Borrowers urged to shop around

Mozo personal finance expert Kylie Moss told Yahoo Finance the lenders were the only two, so far, who had indicated they would not be passing on the cut in full to borrowers.

All providers on its database passed on the RBA’s interest rate cut in May. Virgin Money was the only bank that didn’t pass on the cut in February and received backlash for doing so.

“Aussie’s transparency is a good thing but if customers do feel short changed we encourage them to shop around for a better rate and deal,” Moss said.

It can also be worth customers on older home loan products to double-check to see if a rate cut has been passed on to them.