Home loan calculators

Home loan calculators

Just because lenders will let you sign up for a home loan with less than a 20 percent deposit, doesn’t mean you should. While lenders advertise home loans of up to 95 percent of the purchase price they aren’t advertising the extra costs that come along with having such a low deposit. If you do the calculations, it pays to save a chunky deposit.

Why it pays to save

Besides from avoiding pricey lenders mortgage insurance, the more you save for a down payment the less interest you are likely to pay overall so you’ll be financially better off in the long run. By using our home loan calculator you’ll be able to determine the benefits of saving for longer before you enter the property market.

For instance, if you’re in the market for a $400,000 property and want to borrow 95 percent of that – or $380,000 – at a rate of 7 percent interest, you’ll likely pay around $425,700 in interest over 25 years. But with a larger deposit, of say 10 percent or $40,000, and paying the same rate of interest you could save over $20,000 dollars in interest. To see how much you could save, try using our mortgage loan calculator today.

Need further reasons to save?

While a higher loan-to-value ratio may seem attractive because a smaller deposit is required, there may be additional upfront costs involved in buying a home that you need to factor into your savings plan.

Expenses such as stamp duty, lenders mortgage insurance and establishment fees are just some of the additional funds you may need to outlay when purchasing a home. And some of these fees may be more expensive if you have a smaller deposit.

How to get there, fast!

The good news is that you may be able to reduce some of these additional costs, which means you won’t have to save as much if you follow some of these steps:

  • Lower your property purchase budget. Some states across Australia offer exemptions or discounts on stamp duty depending on how much you want to borrow.
  • First home buyers may be eligible to receive a grant depending on where you live and what you’re buying. They may also be eligible for stamp duty concessions – check if your eligible by using our stamp duty calculator.
  • To help your money grow faster setup a high interest savings account with an automatic savings plan, so your funds are automatically deposited into the account regularly.
  • Use a home loan calculator as a guide to get you started.
  • Compare home loans to see how much you could save.

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Learn more about home loans

What is a low-deposit home loan?

A low-deposit home loan is a mortgage where you need to borrow more than 80 per cent of the purchase price – in other words, your deposit is less than 20 per cent of the purchase price.

For example, if you want to buy a $500,000 property, you’ll need a low-deposit home loan if your deposit is less than $100,000 and therefore you need to borrow more than $400,000.

As a general rule, you’ll need to pay LMI (lender’s mortgage insurance) if you take out a low-deposit home loan. You can use this LMI calculator to estimate your LMI payment.

Interest Rate

Your current home loan interest rate. To accurately calculate how much you could save, an accurate interest figure is required. If you are not certain, check your bank statement or log into your mortgage account.

Mortgage Balance

The amount you currently owe your mortgage lender. If you are not sure, enter your best estimate.

Mortgage Calculator, Interest Rate

The percentage of the loan amount you will be charged by your lender to borrow. 

What is the amortisation period?

Popularly known as the loan term, the amortisation period is the time over which the borrower must pay back both the loan’s principal and interest. It is usually determined during the application approval process.

What happens to your mortgage when you die?

There is no hard and fast answer to what will happen to your mortgage when you die as it is largely dependent on what you have set out in your mortgage agreement, your will (if you have one), other assets you may have and if you have insurance. If you have co-signed the mortgage with another person that person will become responsible for the remaining debt when you die.

If the mortgage is in your name only the house will be sold by the bank to cover the remaining debt and your nominated air will receive the remaining sum if there is a difference. If there is a turn in the market and the sale of your house won’t cover the remaining debt the case may go to court and the difference may have to be covered by the sale of other assets.  

If you have a life insurance policy your family may be able to use some of the lump sum payment from this to pay down the remaining mortgage debt. Alternatively, your lender may provide some form of mortgage protection that could assist your family in making repayments following your passing.

What is an ombudsman?

An complaints officer – previously referred to as an ombudsman -looks at formal complaints from customers about their credit providers, and helps to find a fair and independent solution to these problems.

These services are handled by the Australian Financial Complaints Authority, a non-profit government organisation that addresses and resolves financial disputes between customers and financial service providers.

Do other comparison sites offer the same service?

Real Time RatingsTM is the only online system that ranks the home loan market based on your personal borrowing preferences. Until now, home loans have been rated based on outdated data. Our system is unique because it reacts to changes as soon as we update our database.

Mortgage Calculator, Deposit

The proportion you have already saved to go towards your home. 

Monthly Repayment

Your current monthly home loan repayment. To accurately calculate how much you could save, an accurate payment figure is required. If you are not certain, check your bank statement.

What does going guarantor' mean?

Going guarantor means a person offers up the equity in their home as security for your loan. This is a serious commitment which can have major repercussions if the person is not able to make their repayments and defaults on their loan. In this scenario, the bank will legally be able to the guarantor until the debt is settled.

Not everyone can be a guarantor. Lenders will generally only allow immediate family members to act as a guarantor but this can sometimes be stretched to include extended family depending on the circumstances.

How does a redraw facility work?

A redraw facility attached to your loan allows you to borrow back any additional repayments that you have already paid on your loan. This can be a beneficial feature because, by paying down the principal with additional repayments, you will be charged less interest. However you will still be able to access the extra money when needed.

What is appreciation or depreciation of property?

The increase or decrease in the value of a property due to factors including inflation, demand and political stability.

What is the flexibility score?

Today’s home loans often try to lure borrowers with a range of flexible features, including offset accounts, redraw facilities, repayment frequency options, repayment holidays, split loan options and portability. Real Time Ratings™ weights each of these features based on popularity and gives loans a ‘flexibility score’ based on how much they cater to borrowers’ needs over time. The aim is to give a higher score to loans which give borrowers more features and options.