P & I / Interest Only
Principal & Interest / Interest Only
While most home buyers choose to take a principal and interest home loan, some opt to take an initial interest only period on their mortgage to reduce their monthly home loan repayments while they settle into their new property.
In this scenario, while borrowers are only required to make the minimum interest only repayments, they always have the option while on variable rate (and sometimes fixed) to make additional repayments of principal if they wish to.
This mortgage calculator allows you to compare the amount of your monthly home loan repayment on an interest only and principal and interest basis. You can then decide on which repayment type you feel best suits your cash flow and budget in those first few years of your mortgage.