Are there limits on extra repayments?

Variable rate loans typically have no limits on extra repayments. Fixed rate loans usually allow $10,000-$20,000 per year in extra repayments without penalty. Check your loan terms for specifics.

Should I pay extra or put money in an offset account?

Both achieve similar interest savings, but offset accounts offer more flexibility - you can access the funds if needed. Extra repayments into the loan can only be accessed via redraw (if available).

What's better - lump sum or regular extra payments?

A lump sum saves more interest overall because it reduces principal immediately. However, regular extra payments are more sustainable for most budgets and still save significant amounts.

Can I reduce my loan term instead of my repayments?

Yes! Many lenders let you keep the same repayment after rate drops, which acts as an extra payment. Or you can formally restructure to a shorter term for bigger savings.

Extra Repayment Calculator

Calculator

See how extra repayments can save you thousands in interest and years off your loan

Free to useNo data storedAI insightsUpdated: February 2026

Making extra repayments is one of the most powerful ways to save money on your home loan. Even small additional payments can save you tens of thousands in interest and take years off your loan. Use our calculator to see exactly how much you could save.

Enter Your Details

Real-World Examples

Young Professional Building Wealth

Mei has a $450,000 loan at 6.2% over 28 years remaining. She puts $200 extra per month.

Inputs Used:

loanAmount:450,000interestRate:6.2loanTerm:28extraRepayment:200extraFrequency:Monthly

Interest saved: $82,000. Loan paid off 5.5 years earlier. The $200/month effort results in wealth creation of $82,000 that would otherwise go to the bank.

Using Annual Bonus

Stuart puts his $5,000 annual bonus directly onto his $600,000 mortgage at 6.5%.

Inputs Used:

loanAmount:600,000interestRate:6.5loanTerm:25extraRepayment:5,000extraFrequency:Yearly

Interest saved: $71,000 over the life of the loan. Each yearly $5,000 payment has a multiplier effect, saving roughly 14x its value in interest.

Frequently Asked Questions

Glossary

Redraw Facility

Allows you to access extra repayments you've made. Unlike offset, the money must be formally 'redrawn' and some lenders charge fees.

Break Costs

Penalties charged for exceeding extra repayment limits on fixed rate loans. Can be thousands of dollars.

Principal

Your original loan amount. Extra repayments reduce principal directly, meaning less interest is charged on the remaining balance.

Amortization

The process of paying off a loan through regular payments. Extra payments accelerate this process.

Related Tools

Calculate Your Baseline Repayments

See your standard monthly repayments before adding extras.

Compare Offset Account Benefits

Understand if an offset account might work better for your situation.

Explore Split Loan Options

See if splitting fixed and variable gives you the best of both worlds.

How to Use

1Enter your current loan balance
2Input your interest rate
3Enter your remaining loan term
4Choose an extra repayment amount
5Select how often you'll make extra payments
6See your interest savings and time saved

Key Information

An extra $100/month on a $500k loan can save over $50,000 in interest
Most lenders allow unlimited extra repayments on variable loans
Fixed rate loans may have limits on extra repayments
Extra payments go directly to reducing your principal

Pro Tips

Round up your repayments to the nearest $50 or $100 - you won't miss it but it adds up fast
Put any windfalls (tax returns, bonuses) straight onto your mortgage for maximum impact
Use an offset account if you need access to your extra payments - same interest savings, more flexibility
Start small - even $50 extra per week makes a significant difference over 30 years

Avoid These Mistakes

Not checking fixed rate extra repayment limits - exceeding them triggers break costs
Making extra repayments into redraw then withdrawing it for non-essentials
Prioritizing mortgage extra payments over paying off higher-interest credit cards first
Forgetting to check the redraw facility terms - some have withdrawal fees or minimums

Disclaimer: This calculator provides estimates only and should not be relied upon for financial decisions. Interest rates, fees, and policies change frequently. Always verify information with lenders directly. This is general information, not personal financial advice. Consider seeking advice from a licensed mortgage broker or financial advisor.

Last updated: February 2026