Get A Breakdown of Your Repayments with our Mortgage Repayment Calculator

These are the two main repayment structures you'll come across when comparing home loans, and they work quite differently.

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With a principal and interest loan,

• Each repayment covers both the interest charged and a portion of the amount you originally borrowed.
• Over time your loan balance reduces, you build equity in your property, and you'll pay less interest overall.
  

With an interest-only loan,

• Repayments only cover the interest charged for a set period, typically between 1 and 5 years.
• Your loan balance stays the same during this time.
• This structure is popular with investors looking to keep short-term costs down, but it's important to plan for when the interest-only period ends and repayments increase.
  

Use our mortgage repayment calculator to compare how each structure affects your monthly repayments.

Your repayments come down to three key factors:

• Loan amount: the more you borrow, the higher your repayments
• Interest rate – even a 0.5% difference can have a significant impact on the life of a loan
• Loan term – a longer term lowers monthly repayments but increases total interest paid
  

For example, a $600,000 loan at an interest rate of 6.5% over 30 years would result in a monthly payment of approximately $3,792. You can use our home loan mortgage repayment calculator to enter your own numbers and get an instant estimate for your situation.

Making small adjustments to how you manage your loan can have a significant impact. Here are some of the most effective strategies:

1. ‍Switch to Fortnightly Repayments: Make payments every two weeks instead of monthly to end up making one additional repayment each year without feeling the difference.‍
2. Make Lump-Sum Payments: Whenever you have extra funds, put them directly towards your loan. This helps reduce the principal balance more quickly.‍
3. Use an Offset Account: Keep your savings in an offset account to lower the balance on which the interest is calculated.‍
4. Round Up Your Repayments: Increase your monthly payment slightly to shave years off your loan.
   

If your current loan isn't structured to help you pay it off efficiently, consider exploring our home loan refinancing service to find a better option.

Our calculator gives you a reliable estimate based on the figures you enter. That said, actual repayments can vary depending on a few things:

• Your lender's specific fee structure
• Whether interest is calculated daily or monthly
• The rate changes over time if you're on a variable-rate loan

We recommend using the calculator as a solid starting point for budgeting, then speaking with one of our specialists to get figures tailored to your situation.

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Opting for a longer loan term reduces your monthly payments, but you will pay more in interest over the life of the loan. In contrast, a shorter loan term results in higher monthly payments but reduces the overall total cost. This presents a trade-off between immediate cash flow and long-term expenses.

The best loan term for you depends on your income, financial goals, and the flexibility you need. Whether you're a first-home buyer working within a tight budget or building a property investment portfolio, our team can help you find the right balance.

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