See what a one-off extra payment does to your home loan — the interest it saves and the time it cuts off the term — when you keep your repayment the same.
What a lump sum actually does
A one-off payment off your loan does two things at once: it shrinks the balance, and — if you keep your repayment the same — it shortens the term. The calculator above estimates both. Enter your current balance, your interest rate, the years left to run, and the size of the lump sum. The result shows the interest you would save over the life of the loan and roughly how much sooner it would be paid off.
Why the saving is larger than it looks
The figure surprises people because interest compounds on the balance you carry each month. Take money off early and you stop paying interest on it for every remaining year of the loan, not just once. The earlier in the term you apply the lump sum, the more there is to save. Your rate matters too: the higher it is, the more each dollar of extra repayment is worth. The calculator assumes you hold your repayment steady after the lump sum, so the whole payment keeps working rather than quietly resetting to a lower minimum.
Use it as a starting point
The maths is only half the question. Whether to pay down the loan, park the money in an offset, or keep it accessible through redraw depends on your loan's terms, your tax position, and what else the cash could be doing. That is a structural decision, not just an arithmetic one. Book a strategy session and we will work through where the money does the most good.
General information only — not personal financial product or credit advice. The estimate is indicative and depends on each lender's policy, current rates and your full circumstances. AeFin is an Australian Credit Representative (CR 464548) of Finsure (ACL 384704).