A fixed vs variable home loan calculator models repayments and total interest for fixed, variable and split rate options. You enter your loan amount, term and the rates you're comparing. It shows the difference in monthly repayments and the total cost under each scenario, including rate movements.
A fixed rate home loan locks the interest rate and repayment for a set period, commonly one to five years, while a variable rate moves up or down with the lender's pricing. Each has trade-offs. Fixed gives certainty. Variable gives flexibility.
The Hub calculator, called Fix or Float, is built to compare scenarios rather than give a single answer. You can test what happens if rates rise by one percentage point, or fall by half a point, or stay where they are. Seeing the range helps you decide how much risk you're comfortable carrying.
It's useful when your fixed term is about to end, when you're taking out a new loan, or when you're weighing whether to split your loan between fixed and variable portions. It's also a good stress-test for anyone who wants to know how much rate rise their budget can absorb.
Compare fixed and variable rates by calculating monthly repayments and total interest under each, then testing what happens if the variable rate moves. The right choice depends on your budget, your tolerance for change, and how likely you are to sell, refinance or pay the loan down early.
Here's the process:
Take a $600,000 loan over 30 years. Say the variable rate is 6.0% and a three-year fixed rate is 5.6%. Monthly repayments come to roughly $3,597 on the variable rate and roughly $3,444 on the fixed rate, a difference of about $153 a month. Now imagine variable rates rise to 7.0% after a year. Repayments on the variable loan would climb to about $3,983 on the remaining balance, roughly $540 a month more than the fixed option.
On a $600,000 loan over 30 years, a rise in the variable rate from 6.0% to 7.0% lifts monthly repayments by roughly $386, which is why fixing part of a loan can protect a tight budget.
The rates in this example are hypothetical and not current market rates. Swap in real quotes to see your own result.
Fixing gives you a known repayment, which suits buyers with tight budgets or variable incomes.
Variable loans typically let you make extra repayments without limits, and they often come with offset accounts and redraw. Many fixed loans cap extra repayments, and offset accounts are often unavailable or limited on fixed portions. Check each lender's rules.
Leaving a fixed loan early can trigger break costs. If you might sell or refinance during the term, that risk matters.
If you fix and rates fall, you pay more than you needed to. If you stay variable and rates rise, you pay more too. The calculator shows how much each mistake would cost.
Fixed suits borrowers who value certainty, variable suits those who want flexibility and extra repayments, and a split loan divides the difference. The best option depends on your budget buffer, your plans over the next few years and how you'd feel if rates moved against you.
| Feature | Fixed | Variable | Split |
|---|---|---|---|
| Repayment certainty | High during the term | Changes with rate moves | Partly certain |
| Extra repayments | Often capped | Usually unlimited | Unlimited on variable portion |
| Offset account | Often limited or not available | Commonly available | Usually on variable portion |
| Break costs | Possible if you exit early | None for rate reasons | Only on the fixed portion |
| Best for | Tight budgets, rate-rise worries | Extra repayments, flexibility | Balanced risk |
Fixed vs variable vs split: fixed protects your budget, variable protects your flexibility, and a split loan gives you some of each.
Terms differ by lender, so confirm the details before you decide. Our refinancing team can compare fixed and variable products across lenders and explain the fine print.
Choose fixed when your budget can't absorb a rate rise and you don't expect to sell or refinance during the term. Choose variable when you plan to make large extra repayments or want full use of an offset account. Choose a split when you want a bit of protection without giving up flexibility.
A borrower who plans to sell or refinance within two years usually gains little from a long fixed term, because break costs can erase the certainty the fixed rate was meant to buy.
Don't pick a rate type by guessing where the market will go. Professional forecasters get it wrong often. Don't compare only the headline rates either. Fees, offset access and extra repayment limits can outweigh a small rate gap. And don't fix your whole loan if you expect a bonus, an inheritance or a sale that you'd want to put straight against the debt.
Break costs are fees a lender charges when you repay a fixed rate loan early, usually because you sell, refinance or make large extra repayments during the fixed term. They depend on how far the rate has moved since you fixed and how long remains on the term.
In general terms, if rates have fallen since you fixed, break costs can be significant. If rates have risen, they may be small or nil. The amount is calculated by the lender, and it can change daily. Ask for a written estimate before you commit to leaving. For independent guidance on home loan types, see MoneySmart.
This matters for planning. If there's a real chance you'll sell within the fixed term, or if you might release equity to buy another property, the potential break cost belongs in your comparison. It's one of the easiest costs to overlook.
If you're looking at combining debts into a refinance at the same time, see our Debt Consolidation Calculator page to check the numbers together.
Your rate choice affects cash flow, your ability to buy again and how much you can borrow. A repayment that jumps unexpectedly can squeeze savings and limit new lending. A stable repayment lets you plan around it, which is why some borrowers fix even when the rate is slightly higher.
Lenders also assess your borrowing capacity using a buffer above the actual rate, so a higher-rate environment can lower how much you can borrow next time. If you're planning to buy an investment property in the next few years, factor that in. The Buying Costs Calculator and LVR Calculator help you see how the next purchase would fit.
For investors, rate choice interacts with tax and cash flow. Interest on investment loans may be deductible, and a rate rise increases both the cost and the deduction. That doesn't make a higher rate good, because you still pay more than you save. Speak with a registered tax professional about your position.
The Hub calculator gives you a clear comparison, and Investors Choice Mortgages can then check it against live lender pricing. The team has arranged loans since 2005 and can access 10+ lenders, so the scenario you model can be matched to a real product.
Our home loan options page explains the loan types we arrange, and the investor lending page covers structures for property investors.
Clients who review their rate structure can uncover meaningful savings, and a review is often the quickest way to find out whether your current loan still suits you. One story from Investors Choice Mortgages shows the scale of what's possible.
Sarah K. from Melbourne refinanced and released equity, saving $340 a month with a three-week turnaround. Reviewing her loan structure was the first step.
Each situation is different, and rates, fees and lender policies change often. Use the calculator for scenarios and a broker for a live comparison.
Fix, float or split, the right answer is the one your budget can carry. Run the numbers in the ICM Hub calculator, then ask a broker to compare live lender rates.
Call 1800 46 48 10 or email askus@investorschoice.com.au. You can also explore other property calculators or read about refinancing.
