Home Loan Repayment Calculator

Frequently asked questions

How are my home loan repayments calculated?

• Your mortgage repayments in New Zealand are primarily calculated based on the total amount borrowed, your current interest rate (fixed or floating), the chosen loan term (usually up to 30 years), and any ongoing fees. Unlike some other markets, in New Zealand interest is typically calculated daily and charged monthly. By reducing your principal balance faster, either through lump sum payments or higher frequency, you directly reduce the daily interest charge.

What is the difference between principal and interest vs. interest-only in New Zealand?

• Principal and Interest (P&I): This is the standard for most New Zealand homeowners. Every payment goes toward both the interest and the original loan amount, ensuring you are debt-free by the end of the term.
• Interest-Only: Your payments only cover the interest cost, meaning the loan balance does not decrease. This is common for New Zealand property investors looking to maximise cash flow or for short-term bridging needs.

How often should I make repayments – weekly, fortnightly, or monthly?

• In New Zealand, you can usually align your repayments with your salary cycle. Choosing weekly or fortnightly repayments is a common mortgage hack. Because there are 26 fortnights or 52 weeks in a year, you effectively make the equivalent of one extra monthly payment every year compared to a standard monthly schedule. This small change can shave years off your mortgage and save thousands in interest.
   

Can I use this calculator for refinancing or investment loans?

• Absolutely. This tool is designed for any New Zealand mortgage scenario. Whether you are looking to refix at a new rate, considering refinancing to a different bank, or calculating the cash flow on a new investment property, simply enter the specific loan details to see your potential repayments.