30 vs 40 year home loan calculator
A longer loan lowers your repayment, but by how much, and what does it really cost? Compare a 25 or 30-year loan with 35 or 40 years and see the extra interest in black and white.
What you'd still owe, year by year
The 40-year line barely moves for the first decade. That's the interest you're paying while the balance stays high.
| Term | Repayment | Total interest | Total repaid | Owing after 10 years |
|---|---|---|---|---|
| 20 years | $4,473/mo | $473,625 | $1,073,625 | $393,969 |
| 25 years | $4,051/mo | $615,373 | $1,215,373 | $465,068 |
| 30 years | $3,792/mo | $765,267 | $1,365,267 | $508,657 |
| 35 years | $3,625/mo | $922,469 | $1,522,469 | $536,861 |
| 40 years | $3,513/mo | $1,086,116 | $1,686,116 | $555,754 |
In short: A 40-year loan on $600,000 at 6.5% cuts the repayment by about $279 a month compared with 30 years ($3,513 instead of $3,792). But you'd pay about $1,086,100 in interest instead of $765,300, roughly $320,800 more, and still owe about $309,400 at the point the 30-year loan is paid off.
How it works
Why a longer loan costs so much more
Interest is charged on what you owe. Stretch the loan out and the balance falls more slowly, so you pay interest on a bigger amount for longer. After 10 years on $600,000 at 6.5%, a 30-year loan is down to about $508,700. A 40-year loan is still at $555,800.
When a longer term can make sense
If a lower repayment is what gets you into the market or keeps your cash flow safe, a longer term can be a tool. Treat it as a safety net, not the plan: pay extra whenever you can and review the loan every year or two.
FAQ
Common questions
Is a 40-year home loan a good idea?
It lowers your repayment, but not by much, and it costs far more. On $600,000 at 6.5%, 40 years saves about $279 a month against 30 years but adds roughly $320,800 in interest. It can help with cash flow, but it's an expensive way to get it.
How much more interest do you pay on a 40-year loan?
On $600,000 at 6.5%, total interest is about $765,300 over 30 years, $922,500 over 35 years and $1,086,100 over 40 years.
How much lower are repayments on a 40-year loan?
Less than most people expect. On $600,000 at 6.5% the monthly repayment is about $3,792 over 30 years, $3,625 over 35 and $3,513 over 40. Going from 30 to 40 years cuts it by around 7%.
Can I take a 40-year loan and pay it off faster?
Yes, if the loan allows extra repayments. Paying the 30-year repayment on a 40-year loan clears it in about 30 years, with the lower minimum there as a back-up. Fixed rate loans may limit how much extra you can pay.
Do all lenders offer 40-year home loans?
No. Only some lenders offer terms longer than 30 years, and they often limit them by age, loan size or loan type. We can tell you which lenders would consider it for you.
Home Loans & Property
Read before you decide
General information only. These calculators give estimates based on the figures you enter and published rates, and don't consider your objectives, financial situation or needs. They're not a quote, credit assessment or tax advice. Elephant Financial Pty Ltd trading as Elephant Advisory is an authorised credit representative (ACR 487962) of Yellow Brick Road Aggregation Pty Ltd, Australian Credit Licence 390261.
