Loan Calculator

How this loan calculator works

For principal-and-interest loans the calculator uses the standard amortisation formula: repayment = P × r ÷ (1 − (1 + r)⁻ⁿ), where P is the amount borrowed, r is the interest rate per repayment period (the annual rate divided by 12, 26 or 52) and n is the number of repayments. Each repayment first covers that period's interest, and the rest reduces the balance — which is why early repayments are mostly interest and later ones mostly principal.

Interest-only periods charge just the interest, so the balance doesn't fall; when the interest-only period ends, the loan is repaid over the remaining term, which makes those later repayments higher. Fees are added on top of the repayments to show a fuller picture of the total cost, similar in spirit to a comparison rate.

Why fortnightly repayments can save interest

Paying half the monthly amount every fortnight means 26 half-payments a year — the equivalent of 13 monthly repayments instead of 12. Choosing "Fortnightly" here instead calculates the exact fortnightly repayment for the term, so to model the "half-monthly" strategy, use the Extra repayments tab with an extra amount equal to one-twelfth of your monthly repayment.

Limits of any calculator

• Rates can change over the life of a variable loan; this calculator assumes one rate for the whole term.
• It doesn't include government charges, lenders mortgage insurance, break costs or account-keeping fees unless you add them.
• Results are rounded and illustrative. Check a lender's key facts sheet and comparison rate before you decide.

Read more: how loan term changes what you really pay and how lenders assess loan applications.