Australian Mortgage Repayment Calculator

Last updated: May 2026. Reflects current Australian metrics.

Instantly calculate your home loan repayments based on current Australian interest rates. Whether you are dealing with the Big 4 banks or a non-bank lender, see exactly how much you'll pay in principal and interest over the life of your loan.

Loan Details

$
%
Use the comparison rate for a truer cost.
Yrs

Estimated Repayment

per month

$3,652.32
Total Interest Payable $714,834.40
Total Loan Cost $1,314,834.40

Amortisation Schedule

How to Use This Calculator

  1. Enter your loan amount: Input the total sum you intend to borrow. Remember that your Loan-to-Value Ratio (LVR) should ideally be below 80% to avoid Lenders Mortgage Insurance (LMI).
  2. Set the interest rate: Input your bank's advertised rate, or ideally, the comparison rate. You can adjust this to see how potential RBA cash rate hikes might affect your budget.
  3. Choose your frequency: Selecting fortnightly or weekly payments instead of monthly can significantly reduce the total interest paid over a 30-year term due to the way interest is calculated daily in Australia.

How Mortgage Repayments Work in Australia

Taking out a home loan is one of the most significant financial commitments for Australians. Understanding how your repayments are structured is crucial under the National Consumer Credit Protection Act guidelines enforced by ASIC.

Principal and Interest (P&I) vs Interest Only (IO)

Most owner-occupiers choose Principal and Interest (P&I) loans. A portion of every repayment goes toward reducing the actual debt (the principal), while the rest pays the bank's interest. As the balance decreases, the interest portion of your repayment shrinks, and the principal portion grows.

Interest Only (IO) loans are popular among property investors leveraging negative gearing. For a set period (usually 1 to 5 years), you only pay the interest charges. Your loan balance does not decrease. Once the IO period ends, the loan reverts to P&I, and repayments jump significantly because you now have fewer years left to pay off the same principal amount.

The Power of Repayment Frequency

Australian banks generally calculate interest daily and charge it monthly. By switching your repayment frequency from monthly to fortnightly, you effectively make 26 half-payments a year—the equivalent of 13 full monthly payments. This extra payment goes directly to the principal, shaving years off your loan term and saving tens of thousands in interest.

Offset Accounts and Redraw Facilities

Many variable-rate loans from the Big 4 (CBA, Westpac, NAB, ANZ) and non-banks offer a 100% offset account. The balance in your offset account is subtracted from your loan principal before interest is calculated. For example, if you owe $500,000 but have $50,000 in your offset, you are only charged interest on $450,000. A redraw facility is similar, allowing you to access extra repayments you've made directly into the loan account.

Related Calculators

Mortgage Calculator Borrowing Power Stamp Duty

For more information on purchasing property, visit ASIC MoneySmart Home Loans.

10 Frequently Asked Questions

1. What is the current RBA cash rate?
As of 2026, the RBA cash rate influences all variable home loans. Check the official RBA website for the exact daily rate, but currently, variable rates sit around the low 6% mark.
2. How does the 3% serviceability buffer work?
APRA mandates that banks assess your ability to repay a loan at an interest rate 3% higher than the rate you are applying for. This ensures you can handle future rate hikes.
3. What is Lenders Mortgage Insurance (LMI)?
LMI is insurance that protects the lender if you default. It is usually required if your deposit is less than 20% of the property's value (LVR > 80%).
4. Should I choose a fixed or variable rate?
A variable rate offers flexibility (like offset accounts), while a fixed rate provides repayment certainty for a set period (usually 1-5 years).
5. What is a Comparison Rate?
Required by Australian law, the comparison rate rolls the interest rate and most fees into a single percentage to show the true cost of a loan.
6. What is an offset account?
An offset account is a savings account linked to your loan. Its balance is subtracted from your loan principal before interest is calculated, saving you money.
7. Can I make extra repayments?
Yes, most variable loans allow unlimited extra repayments. Fixed loans usually cap extra repayments (e.g., $10k/year) and charge break fees if exceeded.
8. What is negative gearing?
Negative gearing is an Australian tax strategy where the costs of owning an investment property exceed its rental income, allowing you to deduct the loss from your taxable income.
9. What are stamp duty concessions?
Each Australian state offers stamp duty exemptions or concessions for First Home Buyers purchasing below a certain price threshold.
10. How is interest calculated?
In Australia, home loan interest is generally calculated daily on your outstanding balance and charged monthly.