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Loan Repayment Calculator

A Loan Repayment Calculator will provide you with an estimate of what your monthly home loan repayments will be based on your given interest rate and loan term. The repayment frequency can be changed to weekly, fortnightly or monthly. It also calculates both Principal and Interest repayments for a loan term.

Understanding Different Repayment Frequencies

There are several loan repayment frequencies that borrowers can choose from in Australia, including weekly, fortnightly, and monthly repayments.

1. Weekly Repayment

Weekly repayments involve paying a portion of the loan each week. By doing so, borrowers make 52 payments in a year, which is equivalent to 26 fortnightly payments or 12 monthly payments.

This repayment frequency is suitable for borrowers who receive their income on a weekly basis and can manage smaller payments throughout the year.

2. Fortnightly Repayments

Fortnightly repayments require making a payment every two weeks, resulting in 26 payments in a year. This frequency is appropriate for borrowers who receive their income on a fortnightly basis.

By making fortnightly payments, borrowers can make an extra month’s worth of repayments each year compared to making monthly payments, which can result in significant interest savings over the loan’s life.

3. Monthly Repayments

Monthly repayments involve making a payment once a month, which is suitable for borrowers who receive their income on a monthly basis. Monthly payments provide a fixed payment amount each month, which can make it easier for borrowers to plan their finances and manage their budget.

How To Choose The Suitable Repayment Frequency

Choosing the most appropriate loan repayment frequency in Australia is a complex decision that depends on various factors, such as an individual’s financial status, budget limits, and personal preferences.

Typically, the three most commonly used loan repayment frequencies in Australia are weekly, fortnightly, and monthly.

  • Benefits of Weekly or Fortnightly Repayments

Opting for more frequent payments, such as weekly or fortnightly, can yield significant interest savings over the loan’s lifetime. This is because interest on loans is generally calculated on a daily basis, meaning that borrowers can reduce the interest charged on their principal by increasing the payment frequency.

Additionally, making frequent payments can expedite loan repayment, ultimately reducing the interest charges that borrowers would have incurred if they had made payments less frequently.

  • Benefit of Monthly Repayments

Monthly repayments can be beneficial for those who prefer a simpler budgeting approach. With monthly payments, borrowers are assured of a fixed payment amount each month, making it easier for them to manage their finances and budget accordingly.

These payments are particularly suitable for borrowers who receive their income on a monthly basis or have other financial commitments that align with a monthly payment schedule

Need More Advice?

If you require assistance in determining the suitable loan repayment method, it is advisable to consult with one of our Excellence Finance mortgage brokers today.

It is crucial to bear in mind that calculator calculations are only approximations and do not incorporate all charges and fees. As a result, relying solely on them for making loan decisions is not advisable. Additionally, interest rates and other expenses are subject to change, potentially impacting the overall loan cost.

Hence, it is suggested that borrowers consult a qualified Australian Credit Licensee or Authorised Credit Representative mortgage broker to discuss their individual financial situation

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