See the impact of a one-off lump sum on your loan.
A lump sum reduces the balance the day it lands, and every interest charge after that is calculated on the smaller amount. Because the effect compounds across the remaining term, a single payment made early can remove far more in total interest than its own size. The calculator shows both the interest avoided and the change to the loan term.
After a lump sum you generally have a choice: keep repayments the same and finish earlier, or reduce repayments and keep the original term. Keeping repayments the same is what produces the large interest saving; reducing them hands most of the benefit back. Lenders often default to one behaviour, so confirm which applies.
Check whether you can access it again if you need to. On a variable loan with redraw or offset the money generally stays available; on a fixed loan there is usually an annual cap on extra repayments and a break cost above it. Confirm the terms on your specific loan first.
A calculator gives you a starting figure. What a lender will actually approve depends on your income, expenses, credit history and the property, and it varies between lenders. We compare more than 40 lenders on our panel and will tell you where you genuinely stand — see our home loan, refinancing and car loan services, or the suburb pages for Werribee, Tarneit and Point Cook.
That depends on your rate, your tax position and your need for access. A loan repayment is an after-tax saving, so the comparison is not simply rate against rate. Speak to your accountant or adviser.
It can, if you ask for it. Keeping the repayment unchanged is what shortens the loan and produces the larger saving.
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