Helpful repayment formula

Hi all

I’m not sure if this has been posted before.

Here’s a formula I use to quickly calcute how much a loan is going to cost me to repay with respect to actual weekly repayments. It really helps if you’re looking at a property and need to quickly calculate your outgoings.

The formula works using the following parameters

Interest rate 6.75%
Term 30yrs (360 monthly repayments)

You take your purchase price
Divide by 1000
multiply by 1.5 (or add 1/2 of this amount)
this equals your weekly repayment.

If you take this figure,mutiply by 52, then divide by 12, you will be within a few dollars of the banks monthly repayments

eg purchase price
$80,000
divided by 1000 = $80
multiply by 1.5 = $120 (or add $40 to your $80)
weekly out of pocket repayment is $120
x 52 =$6240
divided by 12 =$520

Bank figure is $518.88
_________________________
for $300 000

weekly repay is $450 = $1950pm
bank figure is$1945.79

The result is always a bit over, but at least it helps make a quick on-the-spot decision re cash flow

T