Estimate your monthly home loan repayment, including principal, interest, council rates, home insurance and strata fees.
Rates as of Q2 2025 (example)
| Period | Date | Payment | Principal | Interest | Balance |
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This calculator estimates your monthly home loan repayment and the full cost of borrowing for a property purchase. It shows the principal and interest repayment, optional additional costs (council rates, home insurance, strata fees), the total interest paid over the life of the loan, and a full amortisation schedule — so you can see exactly how your balance reduces month by month and how much extra repayments can accelerate payoff.
This calculator uses the standard loan amortisation formula, which produces a fixed monthly principal and interest (P&I) repayment that fully pays off the loan — plus all interest — over the specified term.
Formula: Monthly Repayment = [Loan Amount × Monthly Rate] ÷ [1 − (1 + Monthly Rate)−N], where Monthly Rate = Annual Rate ÷ 12 and N = Loan Term × 12. Total Interest = (Monthly Repayment × N) − Loan Amount.
Example: A A$650,000 property with a A$130,000 deposit (20%) gives a loan amount of A$520,000. At a 6% interest rate (example rate — enter your actual rate) over 30 years: monthly P&I repayment ≈ A$3,117.66. Adding annual council rates of A$2,200 (A$183.33/month) and home insurance of A$1,500 (A$125/month) gives a total monthly housing cost of about A$3,426. Total interest over 30 years ≈ A$602,358.58 — so the loan costs about A$1,122,358.58 in total (principal plus interest). (Note: this example is for illustration purposes only.)
Home loans (mortgages) are the largest financial commitment most Australians will make. Australian home loans can be principal and interest (P&I, as modelled here) or interest-only (IO), where only the interest is paid each month and the principal is not reduced during the IO period — IO loans are common for property investors but carry risks because the full principal must still be repaid after the IO period ends. Fixed-rate home loans lock in the interest rate for a fixed period (commonly 1-5 years) and provide repayment certainty; variable-rate loans move with the lender's standard variable rate (influenced by the Reserve Bank of Australia's cash rate) and can offer features like offset accounts and redraw facilities. A split loan combines fixed and variable portions. Lenders mortgage insurance (LMI) applies when the loan-to-value ratio (LVR) exceeds 80% — at a 20% deposit (80% LVR), LMI is not required. Australian lenders are required under the National Consumer Credit Protection Act (NCCP Act) to lend responsibly and to disclose a comparison rate alongside the headline rate, incorporating most fees into a single annual percentage figure for comparison purposes. The RBA's Monetary Policy Statement and cash rate decisions directly influence variable home loan rates in Australia, making rate monitoring an important ongoing activity for home loan borrowers.
A principal and interest loan requires you to repay both the interest charged and a portion of the loan principal each month, so the balance reduces progressively until fully paid off at the end of the term — this is what this calculator models. An interest-only loan requires only the interest to be paid during the IO period (typically 1-5 years), meaning the principal does not reduce during that time. At the end of the IO period, the loan reverts to P&I repayments, which are higher than if you had been making P&I repayments from the start, because the full principal still needs to be repaid over the remaining (shorter) term.
The comparison rate is a standardised rate that Australian lenders must disclose alongside the advertised interest rate, calculated by incorporating most fees (including application fees, ongoing account fees, and discharge fees) into a single annual percentage. It allows borrowers to compare the true cost of home loans from different lenders on a like-for-like basis, even when fee structures differ. The comparison rate is calculated on a standard loan amount and term (A\$150,000 over 25 years), so it may not exactly reflect your specific loan — but it is the best single figure for initial comparison. Always check the comparison rate, not just the headline rate.
Lenders mortgage insurance (LMI) is an insurance policy paid by the borrower to protect the lender in the event the borrower defaults and the property sells for less than the outstanding loan. LMI applies when the loan-to-value ratio (LVR) exceeds 80% — i.e., when the deposit is less than 20% of the property price. LMI premiums can be significant (several thousand dollars) and are typically added to the loan amount. At exactly 80% LVR (20% deposit), LMI is not required. Use our LMI Calculator to estimate the premium for your deposit size.
An offset account is a transaction or savings account linked to your home loan, where the balance of the offset account reduces the outstanding loan balance for the purpose of calculating daily interest. For example, if you have a A\$520,000 loan and A\$30,000 in an offset account, interest is only charged on A\$490,000. This can substantially reduce the total interest paid over the life of the loan and effectively shorten the loan term — all while keeping your funds accessible. This calculator does not model an offset account; see our Offset Account Calculator for a dedicated projection.
Variable-rate home loan rates in Australia are heavily influenced by the Reserve Bank of Australia's cash rate — when the RBA raises the cash rate, most lenders increase their variable rates (and therefore repayments) within days; when the RBA cuts the cash rate, lenders generally (though not always immediately) pass on the reduction. Fixed-rate loans are not directly affected by cash rate changes during the fixed period, but the fixed rate you are offered is priced based on market expectations of future cash rates. This calculator uses a fixed assumed rate — for a variable-rate loan, your actual repayments will change if your rate changes.
This depends on the after-tax cost of your home loan versus the expected after-tax return from investing. Home loan interest is not tax-deductible for owner-occupiers (though it is for investment properties), so the cost is the full interest rate. If your home loan rate is 6% and you expect your investments to return 8% after tax — but at significantly more risk — the comparison is close. Many Australians choose a middle path: making extra home loan repayments while also contributing to superannuation (which benefits from a concessional 15% tax rate on earnings). Consult a financial adviser for a strategy tailored to your circumstances.
Disclaimer: The information, rates, and figures provided on this page are for educational and illustrative purposes only and do not constitute financial advice. The interest rate used is an example only and does not represent a rate currently offered by any specific lender — actual rates, comparison rates, fees, and lending criteria vary by lender, loan type, and individual creditworthiness and change frequently. This calculator does not include stamp duty, lenders mortgage insurance, legal fees, or other upfront purchase costs. Consult a qualified financial adviser or mortgage broker for advice specific to your circumstances.