Finder makes money from featured partners, but editorial opinions are our own.

Lump sum repayment calculator

Use our simple lump sum repayment calculator to work out how much you can save by making a lump sum repayment on your home loan.

Avatar

By

Richard Whitten

Edited by

Hannah Nissen-Ellison

Updated

Our lump sum repayment calculator can help you work out how much money you can save by adding extra lump sums to your repayments. An extra repayment can also reduce your loan term, so you own your home sooner.

Here's how it works. If you make a large, one-off extra repayment (a lump sum) to your mortgage, you are reducing the principal amount of debt. This means you end up paying less interest in the long run, too.

Our lump sum repayment calculator is an easy tool that lets you estimate how much a lump sum repayment can save you in time and interest.

Not the calculator you were looking for?

How to use the lump sum repayment calculator

In order to use a lump sum calculator, you’ll need the following details:

  • Your loan amount. This is the amount of money you borrowed.
  • The loan term. This is the length of your home loan. Most Australians choose between 20 and 30-year loan terms.
  • The interest rate. The loan's interest rate affects how much interest you pay every month.
  • The repayment frequency. Repayments can be weekly, fortnightly, or monthly, depending upon your agreement with your lender.
  • Lump sump repayment. Enter the single amount you wish to add to the loan as a lump sum repayment.
  • Lump sum made at year. This refers to when you make the lump sum repayment. If you're 2 years into your loan, select 2 years.

Once you input all of the necessary information into the calculator you'll be able to see the results right away and figure out if putting a lump sum toward your mortgage will be worth it in terms of savings. Usually a lump sum payment will go toward your principal more so than interest, which will help you pay down your loan faster than just making general repayments.

Example: Susan's lump sum repayment

Susan just inherited $10,000 unexpectedly. She decides to pay it as a lump sum toward her mortgage. In order to figure out exactly what a lump sum will do for her mortgage she uses a lump sum calculator.

Susan inputs her:

  • Original loan amount: $300,000
  • Interest rate: 3.0%
  • Loan term (30 years) and her repayment frequency (monthly)

Susan then inputs her lump sum information. She is looking to put down $10,000 and has already had her mortgage for 2 years. If she were to put a lump sum of $10,000 toward her loan, she'll save $12,654 in interest and take 1 year and 5 months off her loan.

Her monthly repayments are currently $1,265. This means Susan won't have to pay her mortgage repayment for 17 months, which is $21,505 in total, back in her pocket. Not a bad return for a $10,000 lump sum payment!

* This is a fictional, but realistic, example.

An alternative to making a lump sum repayment is an offset account

If you have come into a large sum of money, you don't have to throw it straight into your home loan. If your home loan has an offset account, you save the money in the account and you'll enjoy a similar benefit to the lump sum repayment but with greater flexibility.

An offset account is a bank account connected to your home loan. Any money that you save in it temporarily reduces (or offsets) your loan principal. This means your repayments stay the same, but you're paying less interest and so you pay off the whole loan faster.

This is the same benefit as a lump sum repayment but with a huge difference. Once you pay the lump sum into your home loan, it's gone. Your lender may let you access some of it via a redraw facility but it's their money now.

With an offset account you still retain total control over the cash while receiving the same benefit. So if you suddenly need some money to cover an urgent expense, it's right there. It's the best of both worlds.

However, if your loan doesn't have an offset account and you're confident you won't need the lump sum again any time soon, then simply throwing it into your home loan is not a bad idea. Getting out of debt faster is always wise.

Compare home loans from across the market

Updated regularly
{"visibility":"visibilityTable","ctaLabel":"Calculate","tableCode":"SAMPLE_COMPARISON_V2_TEMPLATE","nicheCode":"AUFHL","fields":[{"name":"LOAN_AMOUNT","value":"150000","options":"","label":"Borrowing amount","suffix":"$","useSuffixAsPrefix":true,"useDropDownOption":false,"tooltip":""},{"name":"PERIOD","value":"30","options":"","label":"period","suffix":"years","useSuffixAsPrefix":true,"useDropDownOption":false,"tooltip":""}]}
Name Interest Rate p.a. Comparison Rate p.a. Fees Monthly Payment
Unloan Variable Home Loan
Principal & Interest20% min. depositOwner-occupierRefinance
Interest Rate
5.74%
Comparison Rate
5.65%
Fees
Application: $0
Ongoing: $0 p.a.
Monthly Payment
$876
Go to siteMore Info
HSBC Home Value Loan
Principal & Interest40% min. depositOwner-occupier
Interest Rate
5.99%
Comparison Rate
5.99%
Fees
Application: $0
Ongoing: $0 p.a.
Monthly Payment
$900
Go to siteMore Info
Up Home Loan Variable Rate
Principal & Interest10% min. depositOwner-occupierOffset account
Interest Rate
6.15%
Comparison Rate
6.15%
Fees
Application: $0
Ongoing: $0 p.a.
Monthly Payment
$915
Go to siteMore Info
loans.com.au Variable Home Loan
Principal & Interest10% min. depositOwner-occupier
Interest Rate
6.04%
Comparison Rate
6.06%
Fees
Application: $0
Ongoing: $0 p.a.
Monthly Payment
$905
Go to siteMore Info
Macquarie Bank Offset Home Loan Package
Finder AwardPrincipal & Interest40% min. depositOwner-occupierOffset account
Interest Rate
6.24%
Comparison Rate
6.49%
Fees
Application: $0
Ongoing: $248 p.a.
Monthly Payment
$924
Go to siteMore Info
Tiimely Own Variable Rate Home Loan
Finder AwardPrincipal & Interest10% min. depositOwner-occupier
Interest Rate
5.94%
Comparison Rate
5.95%
Fees
Application: $0
Ongoing: $0 p.a.
Monthly Payment
$895
Go to siteMore Info
Newcastle Permanent Building Society Real Deal Home Loan
Principal & Interest20% min. depositOwner-occupierOffset account
Interest Rate
6.04%
Comparison Rate
6.08%
Fees
Application: $595
Ongoing: $0 p.a.
Monthly Payment
$905
Go to siteMore Info
$2,000 refinance cashback offer
Eligible refinancers who apply online and borrow $250K+ (LVR 80% or lower) can get a $2,000 cashback. Terms and conditions apply.
Bendigo Bank Express Variable Home Loan
Principal & Interest10% min. depositOwner-occupierOffset account
Interest Rate
5.97%
Comparison Rate
6.12%
Fees
Application: $250
Ongoing: $10 per month
Monthly Payment
$898
Go to siteMore Info
Homestar Star Gold
Principal & Interest30% min. depositOwner-occupierOffset account
Interest Rate
5.98%
Comparison Rate
5.98%
Fees
Application: $0
Ongoing: $0 p.a.
Monthly Payment
$899
Go to siteMore Info
Mortgage House Chameleon Home Loan
Principal & Interest50% min. depositOwner-occupierOffset account
Interest Rate
5.99%
Comparison Rate
6.03%
Fees
Application: $600
Ongoing: $395 p.a.
Monthly Payment
$900
Go to siteMore Info
G&C Mutual Bank First Home Buyer
Principal & Interest5% min. depositOwner-occupierOffset accountSpecial Offer
Interest Rate
6.19%
Comparison Rate
6.22%
Fees
Application: $0
Ongoing: $0 p.a.
Monthly Payment
$919
Go to siteMore Info
Unloan Variable Home Loan
Principal & Interest20% min. depositInvestmentRefinance
Interest Rate
6.04%
Comparison Rate
5.95%
Fees
Application: $0
Ongoing: $0 p.a.
Monthly Payment
$905
Go to siteMore Info
HSBC Home Value Loan
Principal & Interest30% min. depositOwner-occupier
Interest Rate
6.04%
Comparison Rate
6.04%
Fees
Application: $0
Ongoing: $0 p.a.
Monthly Payment
$905
Go to siteMore Info
Macquarie Bank Basic Home Loan
Principal & Interest40% min. depositOwner-occupier
Interest Rate
6.24%
Comparison Rate
6.26%
Fees
Application: $0
Ongoing: $0 p.a.
Monthly Payment
$924
Go to siteMore Info
Macquarie Bank Basic Home Loan
Principal & Interest20% min. depositOwner-occupier
Interest Rate
6.30%
Comparison Rate
6.32%
Fees
Application: $0
Ongoing: $0 p.a.
Monthly Payment
$930
Go to siteMore Info
Macquarie Bank Offset Home Loan Package
Finder AwardPrincipal & Interest20% min. depositOwner-occupierOffset account
Interest Rate
6.30%
Comparison Rate
6.55%
Fees
Application: $0
Ongoing: $248 p.a.
Monthly Payment
$930
Go to siteMore Info
Macquarie Bank Basic Home Loan
Principal & Interest40% min. depositInvestment
Interest Rate
6.44%
Comparison Rate
6.46%
Fees
Application: $0
Ongoing: $0 p.a.
Monthly Payment
$944
Go to siteMore Info
Up Home Loan Fixed Rate
Principal & Interest 1Y Fixed10% min. depositOwner-occupierOffset account
Interest Rate
6.50%
Comparison Rate
6.19%
Fees
Application: $0
Ongoing: $0 p.a.
Monthly Payment
$949
Go to siteMore Info
loans.com.au SMSF
Principal & Interest20% min. depositInvestment
Interest Rate
7.49%
Comparison Rate
7.50%
Fees
Application: $0
Ongoing: $0 p.a.
Monthly Payment
$1,049
Go to siteMore Info
Up Home Loan Fixed Rate
Principal & Interest 5Y Fixed10% min. depositOwner-occupierOffset account
Interest Rate
6.45%
Comparison Rate
6.28%
Fees
Application: $0
Ongoing: $0 p.a.
Monthly Payment
$945
Go to siteMore Info
loading

More guides on Finder

  • Home Loan rate rise calculator

    Use our simple rate rise calculator to work out how much extra interest you have to pay when interest rates rise.

  • Lenders mortgage insurance (LMI) calculator

    Finder's simple, free LMI calculator can help you estimate your lenders mortgage insurance premiums.
  • Capital gains tax calculator

    Estimate your CGT when selling an investment property or other asset with Finder's simple capital gains tax calculator.

  • Comparison rate calculator

    The comparison rate represents the actual cost of a home loan by taking into account its interest rate and any additional fees charged by the lender.

  • Home equity calculator

    Home equity can help you access extra financing from lenders to spend on things like home renovations or investment properties. Find out how you can calculate the equity in your home.
  • Interest-only Home Loan Calculator

    Estimate the cost of your repayments if you only pay the interest portion of your loan with an interest-only mortgage.
  • Calculate how long will it take to pay off my loan?

    Wondering 'how long will it take to pay off my loan?' Use our free calculator to see how long it will take to pay off your mortgage.
  • Home loan extra repayment calculator

    Our extra loan repayment calculator helps you see how you could save big on interest. Free, fast and easy to use - calculate in 1 minute!

  • Mortgage repayment calculator

    Want to know how to calculate monthly repayments on your new mortgage? In five steps our free home loan repayment calculator crunches the numbers for you.

Find the right home loan now

Ask an Expert

You are about to post a question on finder.com.au:

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • finder.com.au is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Finder only provides general advice and factual information, so consider your own circumstances, or seek advice before you decide to act on our content. By submitting a question, you're accepting our Terms of Use, Disclaimer & Privacy Policy and 6. Finder Group Privacy & Cookies Policy.

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

2 Responses

    Default Gravatar
    garethJuly 8, 2013

    hi, we are about to receive a 100k lump sum we have two home loans on the one property 213k at 5.45% and 129k at 5.69% also a 7k personnel loan at 16.4%. into which loan(s) should we place the money

    Reply
      AvatarFinder
      ShirleyJuly 9, 2013Finder

      Hi Gareth,

      Thanks for your comment.

      Since finder.com.au is a comparison website we’re not licensed to give any personalised financial advice. You may want to consider speaking to a financial advisor.

      Cheers,
      Shirley

      Reply
Go to site