1. What is the PMT Formula?

The PMT (Payment) formula calculates the fixed monthly payment required to repay a loan over a specified term, including interest. It's the standard formula used by Westpac and other financial institutions for personal loan repayments.

2. How Does the Calculator Work?

The calculator uses the PMT formula:

Where:

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

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

3. Importance of Loan Repayment Calculation

Details: Understanding your monthly repayment helps with budgeting and ensures you can comfortably meet your loan obligations without financial stress.

4. Using the Calculator

Tips: Enter the loan amount in AUD, annual interest rate as a percentage (e.g., 7.5 for 7.5%), and loan term in years. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What fees are included in this calculation?
A: This calculates principal and interest only. Westpac may charge additional fees (establishment, monthly service) not included here.

Q2: How does Westpac determine interest rates?
A: Rates depend on loan amount, term, credit history, and whether the loan is secured or unsecured.

Q3: Can I make extra repayments?
A: Westpac personal loans typically allow extra repayments without penalty, which would reduce total interest paid.

Q4: What's the difference between fixed and variable rates?
A: Fixed rates remain constant for the loan term, while variable rates may change with market conditions.

Q5: How accurate is this calculator?
A: This provides an estimate. For exact figures, contact Westpac with your specific loan details.