Home Loan Repayment Calculator

Enter your loan details below to calculate your repayments and see the total cost of your home loan. Results update instantly as you type.

$
$50k $3m
%
0.5% 15%
years
1 yr 30 yrs

Your Repayments

Monthly repayment

$3,653

Principal $600,000
Total interest $715,480
Total repaid $1,315,480
Principal: 46%
Interest: 54%

How is my repayment calculated?

Your home loan repayment is calculated using the standard amortisation formula:

M = P × [r(1+r)ⁿ] / [(1+r)ⁿ−1]

Where P is the principal (loan amount), r is the periodic interest rate, and n is the total number of repayments. Each repayment covers that period's interest first, with the remainder reducing your principal.

Monthly vs fortnightly repayments

Switching from monthly to fortnightly repayments is one of the simplest ways to pay off your home loan faster.

Because there are 26 fortnights in a year (not 24), making fortnightly repayments means you effectively make one extra monthly repayment per year. On a $600,000 loan at 6.2% over 30 years, this can save you over $80,000 in interest and shave around 4 years off your loan.

Average home loan rates in Australia (2024–2025)

Loan Type Average Rate Low End High End
Variable (owner-occupier, P&I) 6.20% 5.74% 7.40%
3-year fixed (owner-occupier, P&I) 6.05% 5.59% 6.89%
Variable (investor, P&I) 6.55% 5.99% 7.75%

Source: RBA Statistics, Canstar. Rates are indicative and change frequently. Always compare current offers.

Principal & Interest vs Interest Only

Principal & Interest (P&I) loans are the most common for owner-occupiers. Each repayment reduces your outstanding balance, meaning you build equity over time and pay less interest overall.

Interest Only (IO) loans are common for investors, particularly during a construction period or when maximising cash flow. You only pay the interest each period — your principal doesn't reduce. After the IO period (typically 5 years), the loan reverts to P&I, which means significantly higher repayments.

Tips to reduce your home loan costs

  • ✓Make fortnightly repayments — equivalent to an extra month's repayment per year.
  • ✓Use an offset account — savings in your offset account reduce the interest you pay daily.
  • ✓Make extra repayments — even $100/month extra can save tens of thousands in interest.
  • ✓Refinance regularly — loyalty tax is real. Compare rates every 2–3 years.
  • ✓Round up your repayments — if your repayment is $2,847, pay $3,000.

Frequently Asked Questions

How much can I borrow for a home loan in Australia? +
Lenders typically allow you to borrow up to 4–6× your gross annual income, though this depends on your expenses, debts, and the lender's serviceability assessment. Most lenders require a minimum 20% deposit to avoid Lenders Mortgage Insurance (LMI), though you can borrow with as little as 5% through the First Home Guarantee scheme.
What is the current average home loan interest rate in Australia? +
As of 2025, the average variable rate for owner-occupiers (P&I) is around 6.20% p.a., though competitive lenders offer rates from around 5.74%. The RBA cash rate strongly influences home loan rates. Always compare current offers as rates change frequently.
Is fortnightly or monthly repayment better? +
Fortnightly repayments are generally better. There are 26 fortnights per year, so you effectively make 13 monthly payments instead of 12. This extra payment per year reduces your principal faster, saving you interest and shortening your loan term — often by 3–5 years on a 30-year loan.
What is an offset account and should I get one? +
An offset account is a transaction/savings account linked to your home loan. The balance offsets your loan principal when calculating daily interest. If you have a $600,000 loan and $50,000 in offset, you pay interest on only $550,000. Offset accounts are highly effective if you consistently maintain a significant balance and can save tens of thousands over the life of a loan.
What is LMI (Lenders Mortgage Insurance) in Australia? +
LMI protects the lender (not you) if you default. It's typically required when borrowing more than 80% of the property value. LMI can cost $5,000–$30,000+ and is usually capitalised into the loan. You can avoid LMI by having a 20% deposit, using a guarantor, or qualifying for the First Home Guarantee.

Disclaimer: This calculator provides estimates for general information purposes only and does not constitute financial advice. Results assume a constant interest rate and do not account for fees, charges, rate changes, or other loan conditions. Always consult a licensed mortgage broker or financial adviser before making borrowing decisions.