Extra repayments calculator

Top tips for repaying your home loan

1. Draw up a budget

Before you take out a home loan, and especially before you commit to making extra repayments, it's important to sit down and hash out a budget, so you know you won’t be stretching yourself too thin for everyday expenses. Plug your details into our handy budget calculator to crunch the numbers and see if paying extra on your home loan is realistic.

Don’t forget to account for lump sum costs in your budget, like your home loan deposit, or home loan fees.

2. Find out how much extra you can pay

Generally speaking, if you’re looking for a variable rate home loan, there usually won’t be a limit to how much you can pay in extra repayments. If you’re opting for a fixed rate, on the other hand, some lenders do have limits, either on an annual basis or over the entire life of the home loan. Make sure you know what you’re home loan will allow you to repay and when, so you can be sure it fits your needs.

3. Utilise other features
The ability to make extra repayments is one of the most popular features for borrowers, but it’s not the only one! Other features, like an offset account, can help you pay off your home loan faster and reduce the amount of interest you pay over the life of your loan. It’s worth keeping an eye on things like your repayment schedule, which can also affect long term interest costs. But not all lenders offer the same features and flexible options, so be sure to read up on which ones you might like to utilise, and find a home loan that includes them.

4. Look out for break fees!
One of the big hazards of making extra repayments on your home loan is being hit with huge break fees for repaying the whole loan too early. Usually only applicable to fixed rate home loans, this fee is designed to cover the cost of any extra interest the lender may miss out on by you repaying the loan early - which is why it’s important to crunch the numbers and work out if it’s really worth making extra repayments. If the cost of the break fee is higher than the interest you’d pay making normal repayments, it may be worth it to just wait the loan term out.

5. Find a competitive home loan
The best way to repay your home loan without breaking the bank? Choose the best home loan deal to begin with! You can check out our home loan search tool for results personalised to your needs - just plug in your desired loan amount, term and the value of your dream property. Or if you’re just testing the waters, dip a toe in with our home loan comparison table, which will show you a list of all the most competitive home loans on the market.