1. What is the Westpac Investment Loan Payment Formula?

The payment formula calculates the fixed monthly payment required to repay a Westpac investment loan over a specified term. It accounts for compound interest and provides an accurate repayment amount.

2. How Does the Calculator Work?

The calculator uses the standard loan payment formula:

Where:

• \( P \) — Principal loan amount (AUD)
• \( r \) — Monthly interest rate (annual rate ÷ 12)
• \( n \) — Total number of payments (term in years × 12)
• \( PMT \) — Monthly payment amount (AUD)

Explanation: The formula calculates the fixed payment needed to fully amortize the loan over its term, accounting for compound interest.

3. Importance of Payment Calculation

Details: Accurate payment calculation helps investors plan their cash flow, assess loan affordability, and compare different loan options.

4. Using the Calculator

Tips: Enter the loan amount in AUD, annual interest rate as a percentage, and loan term in years. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: Does this include Westpac's fees and charges?
A: No, this calculates principal and interest only. Additional fees may apply to actual loans.

Q2: How does interest rate affect payments?
A: Higher rates increase monthly payments exponentially. A small rate change can significantly impact total repayment amount.

Q3: What's the difference between principal and interest?
A: Principal is the loan amount borrowed. Interest is the cost of borrowing, calculated as a percentage of the principal.

Q4: Can I calculate payments for different frequencies?
A: This calculator assumes monthly payments. For fortnightly or weekly payments, adjustments to the formula are needed.

Q5: How accurate is this calculator?
A: It provides accurate estimates for standard loans, but actual payments may vary based on specific loan terms and conditions.