Lump Sum Repayment Calculator

Treating yourself is a must, no doubt about it. But what if we told you that throwing a little extra cash at your home loan could be a good idea as well? 

So, here’s the hack – making those extra repayments whenever you can isn’t just a good move; it’s like dropping a financial bomb on the overall cost of your loan. It can fast-track your journey to mortgage freedom. 

Depending on the rules of your home loan and how much and when you kick in those extra payments, you could end up saving a boatload. Every time you make an extra payment, you’re lowering the loan balance before your interest can strike. Less interest paid equals more money staying in your pocket. 

How does the Home Loan Repayment Calculator work?

Think of your home loan as a giant financial puzzle, and the Lump Sum Calculator helps you figure out how to piece it together better. Here’s the lowdown on how to use and decode this magic calculator. 

How to Use the Calculator 

Firstly, in the calculator, drop down to ‘See how you can pay off your loan faster’, click Extra repayments, lump sum amount. 

Your calculator needs to know:  

• The principal amount of your home loan (that’s the big chunk you borrowed)
• The annual interest rate that’s nibbling away at it
• When you plan to kick in those extra monthly payments
• If you’ve got any grand lump sum payments lined up during the loan’s lifetime 

Let’s break it down with an example. We’re talking a $600,000 home loan, strutting to the beat of a 5.2% interest rate for a solid 30 years. You’re feeling a bit ambitious, so you decide to toss in a cool $15,000 as a lump sum surprise. 

The calculator does its thing and spills the beans. Brace yourself – your 30-year loan just got cut short by a year and four months. And guess what? You’ve just bagged yourself $38,109.26 in interest savings. That’s a chunk of change you’d have spent on interest, but instead, it’s yours to keep. 

How to Read the Results 

The magic’s done its thing, and now you’re staring at results that need decoding. The Lump Sum Calculator lays it out for you like a financial roadmap. 

You’ll see your original principal amount and the lump sum contribution for each glorious year of your loan. Plus, you can peek at a yearly breakdown of interest charges with and without the extra payment. Your financial future is laid out in front of you – less interest, more savings, and a shortcut to mortgage freedom.  

What should I consider with lump sum payments? 

Lump sum payments, like most things in life, have pros and cons. Here’s the lowdown on what to consider, the good and the not-so-good:

How else can I pay down my Home Loan? 

Let’s talk about slaying that home loan dragon in other savvy ways. There’s more than one trick up your sleeve to make those mortgage payments a breeze: 

Fortnightly Payments  

Consider this your financial two-step. If you’re doing the monthly mortgage mambo, switch it up to fortnightly payments. It’s like getting an extra month’s payment in every year – 26 fortnights and you’re ahead of the game. 

Hunt for Lower Rates 

Be the Sherlock of interest rates. Compare what’s out there, and if you spot a better deal, don’t be afraid to ask your current lender to match it and if they won’t, be willing to walk.  

Loan Switching  

Thinking about changing teams and switching lenders? Just make sure the benefits outweigh the breakup fees. It’s like a rewarding relationship – it’s gotta be worth it. 

Play the Higher Repayment Card 

Here’s a sneaky one – pay off your mortgage like you’re dealing with a higher interest rate. When the rates go down, keep those higher payments rolling.  

Offset Accounts 

Ever heard of an offset account? It’s basically a savings account linked to your mortgage. The balance in there works its magic, reducing what you owe. Less owed means less interest, and that means you’re on the fast track to mortgage freedom. 

Where can I find and compare Home Loans? 

We’ve teamed up with the pros over at Lendi, and together, we’re on a mission to make your home loan journey super easy. The result is a one-stop shop where you can compare a bunch of providers and find your way through the home loan jungle.