Mortgage Calculator (Australia)

How mortgage repayments are calculated

Mortgage repayments are calculated using your loan amount, interest rate, and loan term. Each repayment includes both interest and principal. Early in the loan, a larger portion of your payment goes toward interest, while later payments increasingly reduce the principal balance.

What affects your mortgage repayments?

• Loan size – larger loans increase repayments
• Interest rate – higher rates significantly increase total cost
• Loan term – longer terms reduce monthly payments but increase total interest

How to reduce your mortgage faster

Making extra repayments is one of the most effective ways to reduce your loan. Additional payments reduce your balance sooner, lowering the total interest charged and shortening your loan duration. Even small extra amounts can make a significant difference over time.

You can also explore how extra repayments compare with long-term investment growth using our compound interest calculator, or plan your deposit using the savings goal calculator.

Frequently asked questions

How are mortgage repayments calculated in Australia?

They are calculated using an amortisation formula based on your loan amount, interest rate, and loan term.

Do extra repayments really save money?

Yes. Extra repayments reduce your loan balance faster, meaning less interest is charged over time.

How much interest will I pay on my mortgage?

Total interest depends on your loan size, interest rate, and loan duration. Higher rates and longer terms increase total interest significantly.

Is it better to make weekly or monthly repayments?

More frequent repayments can slightly reduce interest, especially if they result in extra payments over time.