How personal loan repayments are worked out
Most personal loans are repaid in equal instalments over one to seven years. Each repayment covers the interest charged on the balance since the last repayment, and the rest reduces the balance. The repayment comes from the amortisation formula M = P × r ÷ (1 − (1 + r)−n): P is the amount borrowed (plus any fee added to the loan), r is the rate per repayment period and n is the number of repayments. The calculator runs it at the frequency you choose and adds any monthly fee on top.
The rate you're offered may not be the advertised one. Moneysmart notes lenders look at your credit score, income, expenses and savings when they set your rate, so use the rate from your quote. The RBA's averages give a sense of what borrowers actually pay:
| Loan amount | 8.32% | 9.50% | 10.44% | 15.00% | 20.00% |
|---|---|---|---|---|---|
| $5,000 | $102 | $105 | $107 | $119 | $132 |
| $10,000 | $204 | $210 | $215 | $238 | $265 |
| $15,000 | $306 | $315 | $322 | $357 | $397 |
| $20,000 | $409 | $420 | $429 | $476 | $530 |
| $30,000 | $613 | $630 | $644 | $714 | $795 |
| $40,000 | $817 | $840 | $859 | $952 | $1,060 |
| $45,000 | $919 | $945 | $966 | $1,071 | $1,192 |
| $50,000 | $1,021 | $1,050 | $1,073 | $1,189 | $1,325 |
How much can I borrow with a personal loan?
Start from the repayment your budget can carry, not from your salary. The calculator's "What I can borrow" mode runs the repayment formula in reverse: at 9.50% over 5 years, $400 a month repays about $19,046, and $750 a month about $35,711. That's the most the repayment covers at that rate.
What a lender will actually approve can be less. Under responsible lending rules it has to make reasonable inquiries about your income, living expenses and debts, verify them, and not offer a loan you could only repay with substantial hardship. Your existing credit card limits count against you even with a $0 balance. There's no set multiple of salary that guarantees a loan amount.
| Monthly repayment | Over 2 years | Over 3 years | Over 5 years | Over 7 years |
|---|---|---|---|---|
| $200 | $4,356 | $6,244 | $9,523 | $12,237 |
| $300 | $6,534 | $9,365 | $14,284 | $18,355 |
| $400 | $8,712 | $12,487 | $19,046 | $24,474 |
| $500 | $10,890 | $15,609 | $23,807 | $30,592 |
| $750 | $16,335 | $23,413 | $35,711 | $45,888 |
| $1,000 | $21,780 | $31,218 | $47,615 | $61,185 |
Shorter or longer term?
Stretching a loan lowers the repayment but adds interest, sometimes a lot. It also keeps you in debt for longer, which matters if you'll want to borrow for something else, such as a home, while it's running. Moneysmart's guidance: shorter terms can mean less interest overall; longer terms may lower repayments but increase the total cost.
| Term | Monthly repayment | Total interest |
|---|---|---|
| 1 year | $1,754 | $1,044 |
| 2 years | $918 | $2,039 |
| 3 years | $641 | $3,064 |
| 4 years | $502 | $4,118 |
| 5 years | $420 | $5,202 |
| 7 years | $327 | $7,458 |
Comparing two offers: why the lowest rate isn't always cheapest
Fees can turn a low rate into an expensive loan. In the example below, Loan A has the lower interest rate but costs more because of its establishment and monthly fees. Loan B's slightly higher rate comes out $640 cheaper over 5 years. Moneysmart makes the same point with its own example, where a loan with a lower interest rate has the higher comparison rate.
| Loan A | Loan B | |
|---|---|---|
| Interest rate | 9.50% | 10.50% |
| Fees | $500 establishment + $10 a month | None |
| Monthly repayment (plus fees) | $430.54 + $10 | $429.88 |
| Total interest and fees | $6,432 | $5,793 |
| Cost including fees (annual rate) | 11.57% | 10.50% |
What the comparison rate does and doesn't tell you
A lender that advertises an interest rate must also show a comparison rate, which combines the rate with the fees known when the loan is advertised. It's calculated on one of six legislated examples ($250 over 2 weeks, $1,000 over 6 months, $2,500 over 2 years, $10,000 over 3 years, $30,000 over 5 years, $150,000 over 25 years), choosing the one closest to the lender's typical loan, and for the $10,000 and $30,000 examples the ad must say whether the rate is for a secured or unsecured loan. Government fees and fees that may never be charged, such as early repayment and late fees, are left out.
So compare comparison rates on the same example, then check your own loan. If you're borrowing $5,000 or $50,000 rather than the example amount, the calculator's "cost including fees" figure is the fairer comparison.
Paying off a personal loan early
Extra repayments cut the interest you pay, but check the contract first. Moneysmart notes fixed-rate loans may charge a fee if you repay early, while variable-rate loans often let you make extra repayments or pay out the loan without one. If you expect a lump sum, such as a tax refund or bonus, a loan without early repayment fees can be worth a slightly higher rate.
Before you borrow
- For up to $2,000 for essentials, a No Interest Loan has no interest or fees if you meet the criteria. See loans with bad credit.
- For short-term spending you can clear within weeks, a credit card's interest-free days or buy now pay later may cost nothing, but standard card rates averaged 21.24% in September 2026 once interest applies.
- Borrowing to clear other debts? Our debt consolidation calculator compares your current debts with one new loan, and the debt consolidation guide explains when it costs more.
- Struggling with the repayments you already have? Call the National Debt Helpline on 1800 007 007 before taking on more credit.
Our personal loans guide explains fixed versus variable, secured versus unsecured and how applying affects your credit report.
Frequently asked questions
How much would a $20,000 loan cost per month?
About $420 a month over 5 years at 9.50%, the RBA's average rate on new personal fixed-term loans in August 2026, or $641 over 3 years. Total interest over 5 years is about $5,202, before fees.
How much would a $30,000 personal loan cost a month?
About $630 a month over 5 years at 9.50%, or $644 at 10.44% (the average fixed rate). Total interest at 9.50% is about $7,803.
How much would a $10,000 personal loan cost a month?
About $320 a month over 3 years at 9.50%, with $1,532 in interest. Over 5 years it's about $210 a month.
How much is a monthly payment on a $45,000 loan?
About $945 a month over 5 years at 9.50%, with $11,705 in total interest before fees. At 10.44% (the average fixed rate) it's about $966 a month, and over 7 years at 9.50% about $735. A loan this size may need security or a strong income to be approved.
How much personal loan can I get on a $70,000 salary?
There's no set multiple of salary. A lender works out what you can repay from your income after tax, your living expenses and your other debts, including credit card limits, and must not lend if you could only repay with substantial hardship. Work out a repayment your budget can carry, then use the calculator's "What I can borrow" mode to see what that repayment covers at your quoted rate.
What will disqualify you from a personal loan?
Moneysmart lists the usual reasons a lender says no: late or missed repayments, unpaid debts, many recent credit applications, or a default or serious credit infringement on your credit report; and income that's too low for the loan amount, high expenses, or other debts that reduce your capacity to repay. Lenders must decline a loan if their assessment shows repaying it could cause you hardship.
What is the cheapest way to borrow $100,000?
Compare total cost, not just the rate. $100,000 is above the unsecured personal loan limits on several lenders' own pages (ANZ up to $75,000, CommBank $4,000 to $50,000, NAB $5,000 to $55,000, Plenti up to $75,000, checked 10 October 2026). Borrowing against your home usually costs less in rate, but it secures the debt on your home and often runs over a much longer term, which can cost more in total. Price each option's repayments and total interest in this calculator, fees included.
How can I get $20,000 immediately?
Be careful with anything promising money today: no licensed lender can approve a loan without checking you can afford it, and fast cash usually means high fees. Moneysmart says most payday lenders charge 20% of the amount upfront plus 4% a month. If the need is urgent and you're on Centrelink, an advance of part of your payment costs no interest, and a No Interest Loan covers essentials up to $2,000. For anything else, a personal loan from a mainstream lender after a normal application is usually the cheapest route.
How is interest on a personal loan calculated?
Interest is charged on the balance you still owe, so it falls as you repay. Each repayment covers the interest charged since the last one plus some of the principal. The calculator uses the standard amortisation formula at the repayment frequency you choose.
Is a shorter or longer personal loan better?
A shorter term costs less in total but has higher repayments. On $20,000 at 9.50%, 3 years costs about $3,064 in interest and 7 years about $7,458. Choose the shortest term you can comfortably afford.
Does the comparison rate include all fees?
It includes the fees you know about when the loan is advertised, such as establishment and monthly fees. It leaves out government charges and fees that may never happen, like early repayment and late fees, and it's only exact for the example amount and term the lender used.