Home loan repayment calculator, with the stress test banks apply.
Monthly, fortnightly and weekly repayments at your rate and term, the total interest over the loan, what the +3% assessment buffer does to the numbers, and what extra repayments actually save.
- Monthly repayment (P&I)
- $3,559
- Total interest
- $681,175
- At +3% (bank stress test)
- $4,785/mo
$1,779 fortnightly · $821 weekly
Lenders assess your application at roughly 3 percentage points above the actual rate. If the stressed repayment scares you, so will the bank's calculator.
Indicative only: repayments vary with fees, offsets and rate changes. The real question is whether $3,559 is the sharpest the market offers for your situation: check your loan in 2 minutes.
Monthly repayments at a glance.
Principal and interest over 30 years, by loan size and rate. Run your exact numbers in the calculator above; these are the reference points people ask about most.
| Loan amount | 5.0% | 5.5% | 5.9% | 6.5% | 7.0% |
|---|---|---|---|---|---|
| $400,000 | $2,147 | $2,271 | $2,373 | $2,528 | $2,661 |
| $500,000 | $2,684 | $2,839 | $2,966 | $3,160 | $3,327 |
| $600,000 | $3,221 | $3,407 | $3,559 | $3,792 | $3,992 |
| $700,000 | $3,758 | $3,975 | $4,152 | $4,424 | $4,657 |
| $800,000 | $4,295 | $4,542 | $4,745 | $5,057 | $5,322 |
| $1,000,000 | $5,368 | $5,678 | $5,931 | $6,321 | $6,653 |
Principal and interest, 30-year term, standard amortisation, generated by the same model the calculator runs. The rate columns are modelling points, not rates on offer. Indicative only: your rate, fees and structure change the figure, and lenders assess you at roughly 3 percentage points above the rate you pay.
Two readings worth taking from the table: the difference between 5.5% and 6.5% on a $600,000 loan is $386 a month ($4,628 a year), which is why the six-monthly repricing call matters. And a lender assessing you at the 3% buffer reads your $600,000 loan at roughly the 8.9% row that isn't on this table: $4,785 a month. That gap between what you'd pay and what you must prove you could pay is the borrowing power question, and the borrowing power estimator runs it.
What extra repayments actually buy.
A worked example on a $600,000 loan over 30 years at an illustrative 6% (a modelling rate, not a rate on offer). The minimum repayment is $3,597 a month and the interest over the full term is $695,029. Every row below is that same loan with one extra amount paid each month from day one.
| Extra per month | Loan paid off in | Years saved | Interest saved |
|---|---|---|---|
| $100 | 27.9 years | 2.1 | $58,423 |
| $200 | 26.1 years | 3.9 | $106,693 |
| $300 | 24.6 years | 5.4 | $147,415 |
| $500 | 22.1 years | 7.9 | $212,713 |
| $1,000 | 17.7 years | 12.3 | $320,590 |
Modelled at 6% held constant for the whole term, generated by the same amortisation the calculator above runs. Rates move, so treat this as the shape of the effect rather than a forecast. Fixed-rate loans usually cap extra repayments, and some loans charge for early repayment in full.
The first $100 a month is the hardest-working money in the table: $58,423 of interest saved, because it attacks the balance in the years when the balance is largest. Each additional $100 saves a little less than the one before, and by $1,000 a month you are buying 12.3 years off the term. Timing carries the same lesson: the identical dollars paid in year twenty save a fraction of what they save in year one, which is why the argument for starting small and early beats the argument for waiting until you can do it properly.
Offset account, or extra repayments?
In pure interest terms they do the same job. A full offset account is a transaction account linked to the loan, and the balance in it is subtracted from the loan balance before interest is calculated, so $30,000 sitting in an offset against the $600,000 loan above saves $1,800 of interest in the first year, exactly as$30,000 of extra repayment would.
The differences are all practical, and they matter more than the arithmetic.
- Access. Offset money is yours, in a normal account, withdrawable at an ATM. Extra repayments sit inside the loan and come back only through redraw, which lenders can restrict, reprice or freeze, and which some have reduced with little notice.
- Tax, if the property is or becomes an investment. Interest is deductible according to the purpose of the borrowing. Redrawing from a loan is new borrowing, and the deduction follows what you spend it on, so redrawing for a holiday permanently contaminates part of the loan. Money moving in and out of an offset is your own cash and changes nothing. If there is any chance the home becomes a rental later, that difference is the whole ball game, and it is a conversation for your accountant as much as your broker.
- Cost. Offsets usually live inside a package with an annual fee. If you keep a small balance the fee can exceed the interest saved; if you keep a large one it is trivial. Work out the balance at which the fee breaks even before you pay for the feature.
- Discipline. Extra repayments are hard to undo, which is the point for some households and the problem for others. Offsets only work if the money actually stays there.
Partial offsets exist and are worth less than they sound: only part of the balance counts. If your current loan has an offset you are not using, or a package fee you are paying for features you never touch, that is precisely what the home loan health check flags in two minutes.
Principal and interest, or interest only?
Interest only means the balance does not move. It lowers the payment now and raises the payment later, because the same debt has to be repaid over a shorter remaining term. The table is the same $600,000 loan at the same illustrative 6%, over a 30-year total term.
| Structure | First 5 years | Years 6 to 30 | Total interest |
|---|---|---|---|
| Principal and interest from day one | $3,597/mo | $3,597/mo | $695,029 |
| 5 years interest only, then P&I | $3,000/mo | $3,866/mo | $739,743 |
Same amortisation the calculator runs, at a constant illustrative rate. Interest-only periods are usually capped at 5 years for owner-occupiers and are reassessed before they can be extended.
Read it as a trade, not a saving: $597 a month of relief now, in exchange for $269 a month more later and $44,713 more interest overall. There are situations where that trade is right, and they are specific: an investment property where interest is deductible and you would rather direct spare cash at non-deductible home debt, a construction loan during the build (interest only on drawn funds is standard), a genuine short-term cash-flow squeeze, or a bridging period. Choosing it to afford a house you otherwise cannot afford is how people meet the cliff at the end of the term with no plan.
Lenders price interest-only loans above principal and interest and assess them harder: serviceability is usually tested on the principal-and-interest repayment over the remaining term after the interest-only period ends, which shrinks borrowing power rather than expanding it.
The fortnightly trick, and the version that does nothing.
There are two ways a lender can turn a monthly repayment into a fortnightly one, and only one of them saves you anything.
Half the monthly amount, 26 times a year. On the $600,000 example that is $1,799 a fortnight, which comes to $46,765 a year against $43,168 if you paid monthly. You have quietly made a thirteenth monthly payment. Over the full term it takes about 5.4 years off the loan and saves roughly $147,331 in interest, which is the same effect as adding $300 a month to the minimum.
A recalculated "true fortnightly" amount. Some lenders take the monthly figure, multiply by 12 and divide by 26, which on this loan is $1,660 a fortnight. That pays exactly the same total each year as monthly repayments and saves nothing at all. It is not a scam, it is just a different definition, and it is worth one question to your lender to find out which one you are on.
Two caveats. Weekly and fortnightly cycles only help while your loan calculates interest daily, which almost all Australian variable loans do. And fixed-rate loans usually cap what you can pay above the minimum each year, so check the cap before you change the cycle: if you are on a fixed rate, the roll-off date is the more valuable thing to have diarised.
What the repayment figure leaves out.
The number above is principal and interest on the loan, and nothing else. The real monthly cost of owning also carries council rates, water, building insurance, body corporate if it applies, and maintenance. The real cost of the loan carries any monthly or annual package fee, and any lenders mortgage insurance you capitalised, which is added to the balance and then charged interest for the life of the loan like everything else.
The calculation also assumes one rate for thirty years, which will not happen. That is what the stress test line in the tool is for: if the repayment at three percentage points higher is uncomfortable, the honest conclusion is to borrow less, not to hope. Work through what a lender would lend you, then the duty and cash you need on the day, and keep the rest of the calculators and checks for the parts of the picture this page does not cover.
Frequently asked questions.
How are home loan repayments calculated?
Principal-and-interest repayments use an amortisation formula: each payment covers the month's interest on the remaining balance plus some principal, so early payments are interest-heavy and later ones principal-heavy. The calculator applies the standard formula lenders use.
Why do lenders assess me at a higher rate than I'll pay?
APRA requires lenders to test that you could still afford repayments if rates rose: the serviceability buffer, currently around 3 percentage points above your actual rate. That stressed figure, not the advertised repayment, is what decides your borrowing power.
Do fortnightly repayments really save interest?
Paying half your monthly amount fortnightly sneaks in one extra month's payment per year (26 halves = 13 months), which genuinely shortens the loan. The effect in this calculator's extra-repayment field: roughly one-twelfth of your monthly repayment as 'extra'. The trap is that some lenders calculate a 'true fortnightly' amount instead (the monthly figure times 12, divided by 26), which pays exactly the same total each year and saves nothing.
What difference do extra repayments make?
On a typical 30-year loan, even a few hundred dollars extra per month removes years from the term and five figures from the interest. The calculator shows your exact numbers. An offset account achieves the same effect while keeping the cash accessible.
How much are repayments on a $500,000 home loan?
Over 30 years, principal and interest, a $500,000 loan costs $2,839 a month at 5.5%, $2,998 at 6.0% and $3,160 at 6.5%. Every half a percentage point is worth roughly $160 a month on a loan that size, which is the whole argument for reviewing the rate every six months rather than the loan.
Is an offset account better than making extra repayments?
In interest terms they are close to identical: a dollar in a full offset account reduces the interest-bearing balance exactly like a dollar of extra repayment. The differences are practical. Offset money stays yours and can be withdrawn without asking; extra repayments have to be redrawn, and lenders can restrict redraw. For investors the tax treatment matters more: redrawing from a loan can change the purpose of the borrowing and affect deductibility, while drawing on your own offset savings does not. Offsets usually sit inside a package with an annual fee, so if the balance you keep is small the fee can outweigh the saving.
What is the difference between principal and interest and interest only?
Principal and interest pays down the debt from day one. Interest only pays the lender's interest and nothing else, so the balance is unchanged when the term ends. On a $600,000 loan at an illustrative 6%, interest only is $3,000 a month against $3,597 for principal and interest. The catch arrives later: after a 5-year interest-only period the same debt has to be repaid over the remaining 25 years, so the repayment jumps to $3,866, and total interest over the 30 years rises by about $44,713.
Can I change my repayments from monthly to fortnightly?
Usually yes, and it is a phone call or an app setting rather than a refinance. Ask the lender to confirm which method they use: half the monthly amount paid 26 times a year adds a thirteenth monthly payment and shortens the loan, while a recalculated 'true fortnightly' amount does not. Also check whether the loan caps extra repayments, which fixed-rate loans commonly do.
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