Use the Atomic Home Loans split loan calculator to calculate the implications of fixing a portion of your loan, while retaining a variable interest rate over the remainder of your home loan.
So, how can a Split Loan help you?
Splitting your loan allows you to fix the interest rate and repayments on a portion of your loan and let the interest rate and repayments on the other part of the loan fluctuate according to variable market rates. If your home loan allows you to split your loan, it may provide you with security over part of your repayment amount, while retaining flexibility over the remainder of your loan..
Generally speaking, a fixed loan will allow you to make very little in the way of extra repayments. This can have a negative impact on how quickly you pay down your mortgage. The positive about fixed loans is that they create a certain peace of mind knowing that your repayments are fixed for a certain period of time. This is particularly useful if you feel like you would struggle making repayments should the interest rate rise.
A variable loan will generally allow you to make unlimited extra repayments. This is a great feature of a variable loan as It allows you minimize your outstanding loan balance as soon as possible, while generally also providing you with a redraw facility so that you can access those extra repayments, should the need occur.
Splitting your loan will give you the best of both worlds. Keep in mind, some lenders may charge extra for the privilege, and those extra costs might offset any savings generated.
This split loan calculator is fairly simple to use. Simply start by inputting your total loan amount. You can then input the details of the fixed portion as a percentage of the loan, along with the fixed period and the fixed interest rate.
On the right hand side of the calculator, you would insert the variable interest rate, the loan term and the repayment frequency.
The results will show you what your repayments are for both the fixed portion of the loan along with the variable portion of the loan.
If the variable interest rate is different to the fixed interest rate, you will also be able to see what the repayments will be after the fixed period.
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