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AussieCalc

Mortgage Repayment Calculator

Calculate your monthly home loan repayments, total interest, and full repayment cost for any Australian mortgage.

When to use

When you're shopping for a home loan, comparing rates, or want to see how extra repayments cut your interest and loan term.

Who it's for

Home buyers, property investors, and existing borrowers considering refinancing.

What you'll need

Loan amount, interest rate, and loan term. Optionally: extra monthly repayments and offset account balance.

$

The amount you are borrowing, not including deposit or fees.

%

Your lender's advertised rate. Ask for the comparison rate too, it includes fees and shows the true annual cost.

Most Australian home loans are 25–30 years. Some lenders offer up to 40 years. Longer terms lower monthly repayments but significantly increase total interest.

Principal and interest repayments only. Does not include fees, lenders mortgage insurance, or rate changes over time. General guidance only — not financial advice.

Saved scenarios

No saved scenarios yet. Adjust inputs and click “Save current” to compare later.

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Loan balance vs interest paid

30-year amortisation — hover to inspect each year

Remaining balanceCumulative interest paid
Line chart showing remaining loan balance declining and cumulative interest paid rising over 30 years
PeriodRemaining balanceCumulative interest paid
Yr 1$593K$36K
Yr 2$585K$71K
Yr 3$577K$106K
Yr 4$568K$140K
Yr 5$558K$174K
Yr 6$548K$207K
Yr 7$538K$240K
Yr 8$527K$272K
Yr 9$515K$303K
Yr 10$502K$334K
Yr 11$489K$364K
Yr 12$474K$392K
Yr 13$459K$421K
Yr 14$443K$448K
Yr 15$426K$474K
Yr 16$408K$499K
Yr 17$389K$523K
Yr 18$369K$546K
Yr 19$347K$567K
Yr 20$324K$587K
Yr 21$300K$606K
Yr 22$274K$623K
Yr 23$246K$639K
Yr 24$217K$653K
Yr 25$186K$665K
Yr 26$153K$676K
Yr 27$118K$684K
Yr 28$81K$690K
Yr 29$42K$694K
Yr 30$0$695K

As you pay down the loan, more of each repayment goes to principal and less to interest. The two lines cross at the point where cumulative interest exceeds the remaining balance.

Home loan basics

How your repayment is calculated

Your monthly repayment is determined by three things: the loan amount, the interest rate, and the loan term. The standard principal-and-interest formula spreads your debt so that each payment covers the interest accrued that month plus a slice of the principal. Early payments are mostly interest; later payments are mostly principal. This is why extra repayments early in the loan save the most.

The RBA cash rate and your mortgage

Australia's variable mortgage rates are heavily influenced by the Reserve Bank of Australia (RBA) cash rate. When the RBA raises the cash rate, lenders typically pass the increase on to variable-rate borrowers within days. A 0.25% rate rise on a $600,000 loan adds roughly $100 to your monthly repayment. Fixed-rate loans are unaffected during the fixed period but revert to a variable rate afterwards.

Variable vs fixed rate loans

Variable rate loans offer flexibility: you can make extra repayments, use an offset account, and benefit when rates fall. Fixed rate loans give certainty: your repayment stays the same regardless of RBA decisions, making budgeting easier. Many Australians use a split loan, fixing a portion of their debt while keeping the rest variable to balance certainty with flexibility.

How to reduce total interest paid

The two most effective strategies are: making extra repayments whenever possible (reducing your principal faster cuts future interest), and using an offset account (your savings balance offsets the principal you're charged interest on). Even a $20,000 offset balance on a $600,000 loan at 6.5% saves approximately $1,300 per year in interest. Switching to fortnightly repayments instead of monthly also makes one extra full payment per year.

What your results mean — a worked example

A $650,000 loan at 6.50% over 30 years produces a monthly repayment of around $4,111 and total interest of approximately $830,000, meaning you repay roughly 2.3× the original loan amount. Rate sensitivity matters: each 0.25% increase in rate on a $650,000 loan adds about $105–110 to the monthly repayment. Extra repayments in years 1–5 save significantly more total interest than the same amount paid in year 20, because the principal reduction compounds over the remaining term.

Worked examples

Offset account impact: $600,000 loan at 6.5% with $50,000 in offset from day one
Without an offset account, a $600,000 loan at 6.5% over 30 years costs approximately $765,000 in total interest. Keeping $50,000 in an offset account from the start reduces the interest-bearing balance to $550,000 each month, saving roughly $3,250 in interest in year one alone. Over the full loan term, a consistently maintained $50,000 offset saves approximately $234,000 in total interest and cuts about 5 years off the loan term.
Extra repayments: $600,000 at 6.5%, adding $500/month from year one
An extra $500/month reduces the principal faster in the early years when the interest-to-principal ratio is highest. On a $600,000 loan at 6.5%, an additional $500/month from year one shortens the loan term by approximately 8 years and saves roughly $240,000 in total interest. The same $500/month starting at year 10 saves considerably less (approximately $94,000) because less term and principal remain.
First home buyer — $580,000 loan at 6.5% over 30 years, 20% deposit on $725,000 home
A first home buyer purchasing a $725,000 property with a 20% deposit of $145,000 takes out a $580,000 loan at 6.5% over 30 years. Monthly repayments are $3,666 and total interest over the life of the loan is approximately $740,000, bringing the total amount repaid to around $1,320,000, roughly 2.3 times the original loan. A useful stress test: if rates rise to 8%, the monthly repayment increases to $4,256, an extra $590 per month. The deposit required also depends on your state; use the Stamp Duty Calculator to add stamp duty and other upfront costs to your deposit planning.

Calculator assumptions

  • Constant interest rate: The same rate applies for every year of the loan term. Variable rates change when the RBA adjusts the cash rate; fixed rates revert to variable at the end of the fixed period. The repayment shown reflects your current rate only.
  • Principal and interest only: The calculator models a standard P&I loan where each payment covers the month's interest then reduces the principal. Interest-only periods, offset account balances, redraw usage, and extra repayments are not modelled, each changes both the required repayment and the total interest paid.
  • Monthly repayments only: Repayments are shown on a monthly basis. Switching to fortnightly repayments, paying half the monthly amount 26 times per year, is equivalent to making one extra full payment annually. On a $600,000 loan at 6.5%, this shortens the 30-year term by roughly 5–6 years and saves approximately $176,000 in total interest.
  • Fees and LMI not included: Ongoing lender fees, Lenders Mortgage Insurance (LMI), and break costs on fixed loans are excluded. Always check the comparison rate from your lender, which factors in most standard fees and gives a more accurate total cost than the advertised rate alone.
  • Nominal figures only: All repayment figures are in nominal (future) dollars. Inflation reduces the real purchasing power of those future repayments. Use the Inflation Calculator to understand what long-term mortgage repayments are worth in today's dollars.

Common mistakes

Focusing on the monthly repayment and ignoring total interest
A $600,000 loan at 6.5% has a monthly repayment of roughly $3,792, which may feel manageable. But over 30 years, the total interest paid is approximately $765,000, meaning you repay about 2.3 times the original loan. Comparing loans on repayment amount alone obscures the true long-term cost. Total interest is the more important figure for any loan you plan to hold to maturity.
Not stress-testing for rate increases
Variable rate loans move with RBA decisions. If rates rise 1.5% from your current rate, that adds roughly $570/month to a $600,000 loan. Most lenders already stress-test serviceability at 3% above the loan rate, but borrowers should do their own check. A useful rule: if a 2% rate rise would make repayments unmanageable, the loan may be too large for your current income.
Comparing advertised rates without checking the comparison rate
The advertised interest rate excludes fees. The comparison rate (required to be disclosed by Australian lenders) factors in most standard fees and gives a truer picture of cost. A loan advertised at 5.89% may have a comparison rate of 6.10% once fees are included. For loans with offset accounts or redraw, also check whether there are ongoing monthly fees.
Assuming extra repayments save the same regardless of timing
Extra repayments made in the first 5 years of a loan reduce the principal during the period when the outstanding balance, and therefore the interest charged each month, is highest. The same dollar amount paid in year 20 saves far less because the remaining balance is much smaller. Front-loading extra repayments produces significantly better outcomes over the full loan term.

Frequently asked questions

What is the current mortgage interest rate in Australia?
Variable home loan interest rates in Australia typically move in line with the RBA cash rate and currently range from around 5.5% to 7.5% depending on the lender, loan type, and your LVR (loan-to-value ratio). Owner-occupier principal-and-interest loans receive the lowest rates. Always compare the comparison rate rather than the advertised rate, as it includes most fees and gives a more accurate cost.
What is the standard home loan term in Australia?
The most common loan term in Australia is 30 years, though 25 years is also popular. Shorter terms (15–20 years) mean significantly higher monthly repayments but far less total interest paid over the life of the loan. A $600,000 loan at 6.5% costs roughly $765,000 in interest over 30 years, but only around $474,000 over 20 years.
What is an offset account and how does it reduce interest?
An offset account is a transaction account linked to your mortgage. Instead of earning interest on your savings, the balance reduces the principal you are charged interest on. If you have a $600,000 loan and $50,000 in your offset, you pay interest on $550,000. This can shave years off your loan and substantially reduce your total interest, all while keeping your savings accessible.
What is LVR and how does it affect my interest rate?
LVR (Loan-to-Value Ratio) is your loan amount expressed as a percentage of the property's value. Borrowing $480,000 against an $800,000 property gives an LVR of 60%. Lenders offer lower rates to borrowers with lower LVRs because the loan is less risky. Borrowing above 80% LVR typically triggers Lenders Mortgage Insurance (LMI), which can cost tens of thousands of dollars.
Can I make extra repayments on my Australian mortgage?
On most variable-rate loans, yes, and it is one of the best things you can do. Extra repayments reduce your principal immediately, cutting the interest charged in every future month. Many fixed-rate loans cap extra repayments at $10,000–$30,000 per year during the fixed period. Check your loan contract or ask your lender before making large lump-sum payments on a fixed loan.
What other costs should I budget for when buying a home?
Beyond the loan repayments, budget for stamp duty (typically 3–6% of the property price depending on your state), conveyancing and legal fees ($1,500–$3,000), building and pest inspection ($400–$800), lenders mortgage insurance if your LVR is above 80%, and ongoing costs like council rates, strata fees, and building insurance. First home buyers may be eligible for stamp duty exemptions or concessions.
What is the difference between an offset account and a redraw facility?
Both reduce the interest you pay on your mortgage, but they work differently. An offset account is a separate transaction account linked to your home loan, the balance sits alongside your loan and is subtracted from it when interest is calculated daily. Your money stays fully accessible like any bank account. A redraw facility lets you make extra repayments directly into the loan and withdraw them later if needed, but access may involve minimum amounts, processing delays, or fees. Importantly, some lenders have the contractual right to freeze or reduce redraw access, which affected borrowers during the COVID-19 period. Offset accounts are generally preferred for flexibility and unrestricted access, though some home loans charge a higher rate or ongoing fee for an offset feature.
Should I choose a fixed, variable, or split rate home loan?
Variable rate loans offer flexibility, unlimited extra repayments, offset accounts, and the ability to refinance without break costs. They carry rate risk: repayments rise when the RBA lifts the cash rate. Fixed rate loans provide certainty for the fixed term (typically 1–5 years), but extra repayments are often capped and break costs can be substantial if you sell or refinance before the term ends. A split loan fixes a portion of the debt for certainty while keeping the rest variable for flexibility and offset benefits, a common compromise for Australians who want some of both. The right choice depends on your income stability, the likelihood of selling or refinancing during the fixed period, and your own risk tolerance. Predicting RBA cash rate movements is notoriously difficult even for professional economists.

How this calculator works

Enter your loan amount, interest rate, and loan term. The calculator uses standard loan amortisation to work out your monthly repayment. Each payment covers the interest that has accrued since the last payment, with the remainder reducing the principal. The chart shows your loan balance declining over the full term, and the early years reveal just how interest-heavy the repayments are, on a 30-year loan at 6%, more than 70% of your first repayment goes to interest.

The interest rate field assumes a fixed rate for the full term. Most Australian mortgages are variable and will change with RBA cash rate decisions. Use the rate field to model scenarios: what does your repayment look like at your current rate, and what would it be if rates rose by 1% or fell by 0.5%? A 1% increase on a $700,000 loan adds roughly $420 per month to repayments.

The extra repayment input shows how much interest you save and by how many years you shorten the loan by paying more each month. Because interest is charged on the outstanding balance, extra repayments early in the loan have a significantly larger impact than the same extra amount made later. Even an additional $200 per month on a $600,000 loan at 6% can shave several years off a 30-year term.

Sources

Last updated: June 2026

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