Australia Mortgage Calculator 2024

How is the repayment calculated?

The tool uses the standard principal-and-interest formula. The periodic rate is the annual rate divided by 12, 26 or 52, the number of payments is the term multiplied by that count, and the instalment is the amount that clears the loan exactly. On the default inputs ($750,000 price, $150,000 deposit, 6.5%, 30 years) the loan is $600,000, the monthly repayment is $3,792, total interest is $765,267 and total repaid is $1,365,267. One rate is used for the whole term.

How does the lender’s mortgage insurance estimate work?

When the loan is more than 80% of the price the tool multiplies the loan by a flat percentage that depends on the ratio: 1% up to 85%, 1.5% up to 90%, 3% up to 95% and 4% above that. These are round figures built into this tool. On a $750,000 price the estimate is $6,375 at 85% LVR, $10,125 at 90% and $21,375 at 95%. The amount is shown separately and is not added to the loan or to the repayment.

Why does the estimate jump when the ratio crosses a band edge?

Each percentage applies to the entire loan, not only the part above the edge. A $637,500 loan at exactly 85% shows $6,375 at 1%; a $639,000 loan at 85.2% uses 1.5% and shows $9,585, an increase of $3,210 for $1,500 more borrowed. The same step appears at 90%, 95% and 80%. A real insurer prices differently, so use the number as a rough marker of where the risk sits.

Does choosing fortnightly or weekly repayments save a lot?

Not in this tool. Switching frequency changes the instalment, not the term. For the default loan the monthly figure is $3,792, fortnightly is $1,750 and weekly $875, and total interest is $765,267, $764,624 and $764,348, a difference of under $1,000. The larger savings associated with fortnightly repayments come from paying half the monthly amount every fortnight, which adds an extra month’s payment a year; the tool does not model extra payments.

What happens with blank or zero inputs?

A rate of 0%, which is also what a cleared box becomes, is respected, and a term of 0 or less uses 30 years. At 0% the instalment is the loan divided by the number of payments and interest is $0. If the deposit is as large as the price, the loan is zero and so are the repayments. With a price of zero the ratio shows 0.0%.

What costs and features are not in the calculation?

Stamp duty, legal and conveyancing fees, valuation costs, application and ongoing account fees, insurance, rates, interest-only periods, offset accounts, redraws, fixed-rate periods that expire and extra repayments are all left out. The 6.5% default is a placeholder, not a market quote.

How current are the percentages built into the tool?

The 80% threshold and the insurance percentages are fixed values labelled 2024. Lenders and insurers set their own pricing, which changes at least every financial year, and the tool’s tables are not updated automatically. Your lender, a mortgage broker or a qualified adviser can give a binding figure; this page cannot.