We partnered with Lendi* to help you compare home loans from over 35 lenders and over 2,500 home loan products.
A home loan is made up of two parts: the principal (the amount you borrowed) and the interest charged on the principal. The interest is calculated on a daily basis, so the less you owe, the less interest you may have to pay. Knowing how much monthly home loan interest you pay and what portion of your payment goes towards reducing the actual loan can be motivating.
It’s easy to use the Principal and Interest calculator, just follow the simple steps below:
The Principal and Interest calculator will provide you with a breakdown. It shows how much of your repayment will go towards the interest and how much towards the principal each month. It also displays a running total on how much you’ve paid towards each, as well as the principal you’ll have remaining at the end of every month. It’s a good idea to see what happens when you put in different extra repayment amounts into the Principal and Interest calculator.
It can show how it might reduce your interest charges and help you pay off your home loan sooner. Maybe you can see what would happen if you diverted funds from, say, your streaming services that you don’t use too often. Putting those funds into your home loan might have surprising long-term results. Seeing the difference it could make, by using the Principal and Interest calculator, is an eye opener and could inspire you to own that home sooner.
Not every borrower will be able to make extra home loan repayments. While having a variable rate home loan allows you to make unlimited additional repayments, fixed rate mortgages can come with restrictions. Most fixed rate home loans will not allow uncapped extra repayments and may charge break fees for going against your loan terms in this way.
Before you try to make extra repayments, contact your lender or read your home loan terms to ensure that you won’t be penalised. If you think that you might like to make extra mortgage repayments on your home loan, consider opting for or refinancing to a home loan with a variable interest rate. If you’d prefer a fixed rate, speak to a mortgage broker about finding a home loan that allows for some extra repayments to be made.
At iSelect, we’ve partnered with Lendi, to help our customers compare home loans from a range of lenders and products and help them try to find a better deal. It’s not hard, it doesn’t take much effort and it may save you a lot. Click here to compare home loans with Lendi today, or give Lendi a call on 1300 186 260 (08:30-18:30).
Last updated: 09/09/2021