Home Loan Schemes, Grants And Support

There are two parts to a home loan balance:

• The principal amount is how much you have borrowed.
• The interest is an amount your lender charges you based on your principal. It's calculated daily as a percentage (your interest rate) of your principal and added to your balance every month.

Principal and interest repayments pay off the amount you borrowed (the principal) and the interest, plus any fees.

By the end of the loan term (up to 30 years), you will have repaid the amount borrowed and the total interest owed, meaning your home will be mortgage-free. 

We calculate your interest in two steps.

First, we multiply the balance on your loan by your interest rate and divide by 365 days in a year. This shows your daily interest charges.  

We then add together your daily interest charges for every day in each month, which produces the monthly interest charge shown on your statement.  

Finally, we divide this up according to your preferred repayment frequency, whether that’s weekly, fortnightly or monthly. This figure is your repayment amount.

If your loan balance was $500,000 with an interest rate of 4.93% p.a. and monthly repayments, the calculation might look like this: 

500,000 x 0.0493 / 365 = $67.53 interest per day 

$67.53 x 30 days in September = $2,026 interest for September

You can use our Mortgage Repayment Calculator to estimate repayments and interest charges over the life of a loan. You can also use the calculator to check the effect that extra repayments could have on your home loan. 

Planning to use an offset account? Calculate how much interest you could save.

Variable interest rate

With a variable rate home loan, your variable rate changes in line with market interest rates. Choose from our basic loan and standard home loan with offset - and get ahead on your home loan with no cap on extra repayments and no associated break costs.  

Fixed interest rate

With fixed rate home loans, your fixed rate won’t be affected by interest rate rises during your 1-5 fixed rate period – so you'll know exactly what your interest rate and repayments will be throughout your fixed rate loan term.  

Split your home loan account

Or you can get the best of both worlds by splitting your balance into separate variable and fixed rate loan amounts.  

Many things affect how fast you can pay down your home loan balance, and how much interest you pay.

Extra repayments. The simplest way to pay off your loan sooner is to make additional repayments on top of the repayments you’re obliged to make. Bear in mind, if you have a fixed rate with us, you can only make up to $30,000 in additional repayments during the fixed rate period, before break costs apply.

Repayment type. You'll need to pay principal and interest repayments (P&I) if you're eligible for one of the guarantees under the Home Guarantee Scheme, meaning you'll pay off both parts of your home loan (the principal loan amount, plus interest). Read more about repayment types.  

Weekly or fortnightly repayments. Choosing the right repayment frequency can make a difference over time, as well – choosing true fortnightly repayments when you apply will allow you to make the equivalent of one extra repayment per year, given there are 26 fortnights in a year. 

Offset. If you link an offset account to your Rocket variable home loan, depositing your savings into this account will help to reduce the interest payable on your principal. Calculate how much you could save with an offset account. 

Home (also known as Building) Insurance covers your home’s physical structures and fixtures, including your garage, fences and paved driveways. It also includes built-in appliances like hot water systems and air-conditioners.

Contents Insurance covers personal belongings at your home, like your furniture, carpet, appliances and clothing. It also includes your BBQ, outdoor furniture and kid’s play equipment.

Yes, it could affect your eligibility as during the entire period that the guarantee is in place, you must:

• Continue to live in the purchased property as an owner-occupied property
• Make principal and interest repayments (except during the construction phase of building a new home)
• Not increase the loan term or loan amount.

For more details, please refer to the relevant Information Guide on the Housing Australia website.