Does Paying Your Mortgage Fortnightly Save Money?

Does Paying Your Mortgage Fortnightly Save Money?

When you take out a home loan you will need to choose whether to make repayments on a weekly, fortnightly, or monthly basis. Monthly repayments is the most common choice but it also results in the highest total interest repayments over time.  

Paying fortnightly instead will save money in the long run because you end up paying an additional month per year. That is due to the fact that there are twenty-six fortnights in a year, not twenty-four. This means that paying fortnightly can substantially reduce the number of years it takes to pay off your home loan.

Paying monthly vs fortnightly

As an example, imagine you take out a $400,000 loan for 30 years at an interest rate of 3.64%. Your monthly payments will be $1,827.58. Over the duration of the loan, the total amount you repay will be $657,931 including both principal and interest.

If you switch from monthly to fortnightly repayments, you’ll be paying an extra $1,827.58 each year. This will cut the time it takes to repay your loan by four years and ten months. You’ll also save $38,145 on interest charges.

Paying weekly vs fortnightly

Paying your mortgage weekly is another option for borrowers. When you choose this route you’ll be paying $456.90 on a weekly basis (using the example above). You’ll also reduce your mortgage by four years because you will be making fifty-two weekly repayments, instead of forty-eight, resulting in effectively making an additional month of repayment per year. Weekly payments pay down your mortgage the fastest of the three options. But compared to paying fortnightly, you’ll only be saving $222 on interest charges.

Monthly vs fortnightly vs weekly mortgage repayments:

$400,000 loan w/ 3.64% interest rate








Interest payable over 30 years loan term




Total loan cost




Time saved repaying loan


4 years

4 years

Interest saved




Generally, the more frequent the payments you make, the more you will save in interest over the term of your mortgage. Whether you choose monthly, fortnightly, or weekly repayments be sure ask your lender for all the calculations before you make a decision.

You can check out our home loan payment calculator to get a rough idea how much your repayments will be. 

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