Should I make my loan repayments fortnightly or monthly?


If you can make home loan repayments fortnightly, you may be able to pay off your loan faster and reduce the interest you’re charged over the life of your loan.

A lender will generally calculate your loan with monthly repayments, but if you can pay half the monthly amount each fortnight, you'll make the equivalent of one additional monthly repayment every year.

It’s a tweak that’s often overlooked, as people occasionally estimate that there are two fortnights in a month and therefore 24 fortnights in a year—when there are in fact, 26 fortnights in a year.

How does it work?

As some months have 30 or 31 days, over the course of a year, these ‘additional days’ make up two fortnights. So, by repaying your home loan fortnightly, you make 26 payments—the equivalent of 13 monthly repayments.

If you can afford to do it, it’s a simple yet effective strategy to drive down the cost of your loan.

How much could I save?

Say you’re making monthly principal & interest repayments of $1,921 on a $350,000 loan, with an interest rate of 5.20% per annum.

If you continue to make monthly repayments, it will take you 30 years and cost you a total of $691,878. That’s the principle amount you have to pay back, plus all the added interest charges.

By changing from monthly to fortnightly principal & interest repayments—effectively meaning an extra payment of $1,921 a year—you’ll pay off your loan four years and 11 months earlier and save $66,959 in interest charges.

1. This example is only for illustrative purposes; interest rates would normally change over a 30-year period.

You can try our Rapid Pay Calculator if you want to crunch your own numbers or calculate home loan repayments based on a number of variables.

Are there other ways I can pay off my loan sooner?

There are a number of small things you can do to pay off your loan faster while maintaining your day-to-day lifestyle. These minor tweaks may not seem like much, but over time can make a big difference.

These tips and scenarios might help you own your home sooner so you can focus on achieving some of your other goals.

Important information

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It’s important to consider your particular circumstances and read the relevant Product Disclosure Statement or Terms and Conditions before deciding what’s right for you. This information hasn’t taken your circumstances into account.

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