How is my interest calculated?

Your loan balance may fluctuate during the month the amount of interest charged each month can vary. The formula used by us is:

Balance x interest rate % divided by 365 days in a year x number of days in the current month.

For example: A loan balance of $200,000 at an interest rate of 7.20% would have a monthly repayment (based on 31 day month) of:

Monthly interest is debited from your account on the last business day of each month. This means that if there are any days in that month that fall on a weekend or non business day then those days will be counted in the following month’s interest calculation.

Using the example above:

To calculate the interest payment for December 2006

The last business day falls on the 29th December and there were no days in November that fell on non-business days. Therefore the number of days of interest charged for December will be 29 days.

So the calculation for the interest payment for January 2007 will be as follows:

The last business day falls on the 31st January and there were 2 days in December that were not counted in the December repayment as they fell on non-business days at the end of the month (Saturday 30th and Sunday 31st). Therefore the January interest repayment is calculated on 33 days, 31 days in January and 2 days of December.

For a quick calculation go to our repayments calculator which will work out your repayment based on a 31 day month.

Change your monthly repayment date

If it doesn’t suit you to have your monthly repayment debited on the last business day of the month download a multipurpose form and nominate which day in the month you prefer to have your loan repayments taken and fax back to us on 02 9247 2868.