What this calculator does
Interest-only mortgage works out the interest-only payment, and what it jumps to once principal repayments begin. Enter your own figures above and the answer updates as you type: nothing is fixed in the code, so the result reflects exactly the numbers you supply.
The formula this calculator evaluates is printed under the tool and explained below, so you can check the working by hand or reuse it in a spreadsheet.
The formula
FormulaInterest-only payment = Loan × i; After the interest-only period, the loan is re-amortised over the remaining term: M = Loan·i / (1 − (1+i)^−n), i = annual rate ÷ 12
The inputs explained
| Field | What to enter |
|---|---|
| Loan amount ($) | A number, measured in your currency. Starts at 400000. |
| Annual interest rate (%) | A number, measured in %. Starts at 6. |
| Interest-only period (years) | A number, measured in years. Starts at 5. |
| Total loan term (years) | A number, measured in years. Starts at 30. |
Worked examples
Every figure in the tables below is produced by this page’s own calculator at build time, so the numbers and the tool always agree. Select any row to load that scenario.
How the answer changes with loan amount
Every other input is held at the calculator’s starting values while loan amount varies. Select any row to load that scenario into the calculator.
How the answer changes with loan amount
| Loan amount ($) | Interest-only payment | Payment once principal repayments start | Increase at that point |
|---|---|---|---|
| 200,000 | $1,000.00 | $1,288.60 | $288.60 (28.9%) |
| 300,000 | $1,500.00 | $1,932.90 | $432.90 (28.9%) |
| 400,000 | $2,000.00 | $2,577.21 | $577.21 (28.9%) |
| 600,000 | $3,000.00 | $3,865.81 | $865.81 (28.9%) |
| 800,000 | $4,000.00 | $5,154.41 | $1,154.41 (28.9%) |
| 1,200,000 | $6,000.00 | $7,731.62 | $1,731.62 (28.9%) |