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How to make a home loan repayment calculator work for you
A home loan repayment calculator can be a useful tool when you’re making mortgage plans ahead of buying a property. Simply entering a few details in to a mortgage calculator can not only help you estimate the repayments you may be able to afford, but help you compare home loan deals from a range of lenders, including options you may not have encountered before.
How does a home loan repayment calculator work?
To use a mortgage calculator, you’ll need to ask several questions:
- How much do you plan to borrow?
- What interest rate do you hope to pay?
- How long do you plan to take to pay off the loan?
- Do you plan to make monthly, fortnightly or weekly repayments?
- Do you plan on making principal and interest repayments, or interest-only repayments?
By entering your answers into a mortgage calculator, you can get an estimate of your home loan repayments. This can tell you how much you’ll likely pay per month (or fortnight or week) and also the total amount the loan may cost over the full loan term.
It’s important to remember that the results of a home loan calculator are an estimate, and are only accurate in relation to the data entered into the calculator. They may not account for fees and charges, or for changes to the interest rate over time.
How can a home loan repayment calculator help me find a mortgage?
It’s important to compare home loans before applying for a mortgage, to make sure the repayments are affordable and the loan suits your financial situation. One way to manage this is to enter the details of individual mortgage offers into a home loan repayment calculator to quickly estimate their costs.
You could also enter your preferred home loan details into a repayment calculator, and use the results as a benchmark for comparing other home loan offers. You may soon discover that some mortgage offers cost more or less than you were expecting. Some mortgage calculators automatically compare your results to other home loan deals, including offers from banks and mortgage lenders you may not have otherwise considered.
Disclaimer
This article is over two years old, last updated on March 29, 2022. While RateCity makes best efforts to update every important article regularly, the information in this piece may not be as relevant as it once was. Alternatively, please consider checking recent home loans articles.
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