Mortgage Repayment Calculator
Estimate your monthly repayments and total interest over the life of the loan. Compare principal & interest vs. interest only.
Monthly Repayment
$4,926
/ month
Rates current as of FY2025-26. Estimates only — not personal advice.
How your home loan repayments are calculated
Every mortgage repayment is split into two parts: interest (the cost of borrowing) and principal (paying down what you owe). On a principal & interest loan the repayment stays level, but early on most of it goes to interest; over time the balance tips towards paying off the loan — a process called amortisation. Three things drive the number: how much you borrow, your interest rate, and the loan term. Adjust them in the calculator above to see your estimated monthly repayment and the total interest you’d pay over the life of the loan.
Principal & interest vs interest only
Principal & Interest (P&I)
You pay down both the loan balance and the interest each month. Repayments are higher, but you build equity and pay far less interest over the life of the loan. This is the standard choice for owner-occupiers.
Interest Only (IO)
You pay only the interest for a set period (usually 1–5 years), so repayments are lower upfront — but the balance doesn’t reduce, and you pay more interest overall. Common with investors for cash-flow and tax reasons; speak to a broker before choosing it.
How much your interest rate really costs
The same $800,000 loan over 30 years (principal & interest), at three different rates. A small difference in rate makes a large difference over 30 years:
5.75% p.a.
$4,669
per month
Total interest: $880,690
6.25% p.a.
$4,926
per month
Total interest: $973,266
6.75% p.a.
$5,189
per month
Total interest: $1,067,963
On this loan, the gap between the highest and lowest rate is about $187,273 in total interest. Securing a lower rate — and the right loan structure — is exactly what a mortgage broker does for you, at no cost to you in most cases.
How CPL Finance can helpWhat affects how much you can borrow
Lenders assess far more than the property price. The main factors that shape your borrowing power and your rate are:
- •Income and employment stability — including bonuses, overtime and self-employed income
- •Existing debts and credit card limits — these reduce borrowing capacity even if unused
- •Living expenses and number of dependants
- •Deposit size and loan-to-value ratio (LVR) — below 80% usually avoids Lenders Mortgage Insurance
- •Interest rate buffer — lenders test you at a rate around 3% above the actual rate
Frequently asked questions
How are mortgage repayments calculated in Australia?
Repayments are based on the loan amount, the interest rate, and the loan term using a standard amortisation formula. On a principal & interest loan, each repayment covers the month’s interest plus a portion of the principal, so the balance gradually falls. The calculator above uses the same formula for an instant estimate.
What is the difference between principal & interest and interest only?
With principal & interest you pay down the loan and the interest together, so you build equity and pay less interest overall. With interest only you pay just the interest for a set period, keeping repayments lower upfront but leaving the balance unchanged. Owner-occupiers usually choose P&I; investors sometimes use IO for cash-flow and tax reasons.
How much deposit do I need to buy a home?
Most lenders look for at least a 5–10% deposit, but a 20% deposit (an 80% loan-to-value ratio) generally lets you avoid Lenders Mortgage Insurance (LMI). First home buyers may access government schemes that allow a smaller deposit without LMI — our brokers can check your eligibility.
Will a lower interest rate really save me much?
Yes — over a 30-year loan even 0.25–0.50% adds up to tens of thousands of dollars in interest. That is why it is worth reviewing your rate regularly. A broker compares dozens of lenders to find a competitive rate and can negotiate on your behalf.
Does using a mortgage broker cost me anything?
In most cases, no. Brokers are typically paid a commission by the lender, not by you, and are legally required to act in your best interests. They can also handle the paperwork and compare loans you might not find on your own. Contact CPL Finance to talk through your options.
Is this calculator’s figure exact?
It is a close estimate using a standard repayment formula, but your actual repayment depends on the lender’s exact rate, fees, offset arrangements and how interest is charged. For a precise figure and a loan tailored to your situation, speak with our finance team.
Want a personalised analysis?
Calculators show estimates. Our specialists model your full situation — tax position, loan structure, investment strategy — and find optimisations a calculator can't.
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