Start with the amount you actually borrow
For this calculator, the amount financed is your entered loan amount minus your deposit. Enter the full amount before the deposit; if you already know your outstanding loan balance, enter that balance and set the deposit to zero. The estimates cover principal-and-interest repayments, not interest-only loans.
A longer term usually lowers each repayment but increases total interest. A higher rate increases repayments and interest costs. Try a higher rate as well as your current one to check how much room your household budget has.
Three schedules that should not be confused
Monthly: 12 repayments per year, calculated to repay the loan over the chosen term. This is the baseline for the separate strategy comparisons.
Standard fortnightly: 26 repayments per year, each calculated to repay the loan over the same term. This is not simply half the monthly amount. Our periodic-interest model estimates a small difference in total interest, but the term remains the same. Actual lender results depend on daily interest and when payments are credited.
Half-monthly every fortnight: take the monthly repayment, divide it by two and pay that amount 26 times per year. The yearly total is 13 monthly repayments, not 12 — an extra 8.33% in scheduled repayments. This needs additional annual cash, even though each payment feels smaller. Paying twice per calendar month instead gives 24 halves and does not create the extra monthly payment.
A worked example: $400,000 at 5.5% over 30 years
These are illustrative figures, not a current lender offer. They use a $500,000 entered amount and $100,000 deposit, with no fees or rate changes.
| Schedule | Per payment | Scheduled per year |
|---|---|---|
| Monthly × 12 | $2,271.16 | $27,254 |
| Standard fortnightly × 26 | $1,047.72 | $27,241 |
| Half-monthly × 26 | $1,135.58 | $29,525 |
The half-monthly strategy schedules an extra $2,271 each year while the loan is outstanding. This model estimates $83,007 less interest and 5.1 years earlier payoff than monthly repayments, without an offset. The final payment is capped at the amount remaining.
An offset saves interest without repaying the loan directly
A linked offset account reduces the balance used to charge interest. With a $400,000 loan and $20,000 in a full offset, interest initially applies to $380,000. Your savings remain in the account and the contractual repayment is unchanged in our model; more of each repayment goes towards principal.
Compare the same repayment schedule with and without the offset to isolate its effect. The calculator’s offset section uses monthly repayments for both cases; the AI guide uses your selected standard schedule for both. Do not add standalone offset and half-monthly savings: changing both affects the balance together. We do not model wages or withdrawals moving through the offset, so our results cannot establish that changing payment dates helps when all spare cash is already held there.
We assume a constant, fully effective offset balance for the whole loan. Most Australian home-loan interest is calculated daily, whereas this tool approximates interest per repayment period. Check whether your account is a full or partial offset, and compare account fees or a higher loan rate against the benefit.
Extra payments and lump sums
A voluntary top-up adds to the standard repayment at your chosen frequency. Its savings compare against that same schedule without the top-up. A yearly or every-second-year lump sum is paid on top of monthly repayments. These examples are separate from the half-monthly and offset scenarios, not a combined plan.
Ask your lender about extra repayment caps, fixed-rate break costs, redraw conditions and how quickly payments reduce the interest-bearing balance. Keep an emergency buffer rather than relying on access rules you have not confirmed.
Put your numbers side by side
Enter your amount, deposit, rate and term in the repayment calculator. Compare standard schedules first, then the half-monthly strategy and offset separately. Your downloadable summary keeps the comparison bases visible; the AI explanation is general information, not a lender quote or personal advice.
Sources and assumptions
ASIC Moneysmart explains ways to pay off a mortgage faster and how mortgage offset accounts work. Example figures above come from this calculator’s shared repayment model. Estimates exclude fees, taxes and future rate changes; confirm your loan’s terms with your lender or a licensed adviser.