Interest-only repayments on a $500,000 loan — New Zealand

At 6% over 30 years with a 5-year interest-only period:

• Interest-only repayment: $2,500 a month
• Reverts to: $3,222 a month
• Payment jump: $722 a month
• Extra interest vs P&I: $37,261

Frequently asked questions

What are interest-only repayments on a $500,000 loan?

At 6%, about $2,500 a month. Nothing comes off the balance, so you still owe $500,000 when the interest-only period ends.

How much does the repayment jump?

By about $722 a month after a 5-year interest-only period, because the full $500,000 must then be repaid over the remaining 25 years.

What does it cost overall?

About $37,261 more interest over the life of the loan than paying principal and interest from the start.

Compare with principal & interest on the same loan

Estimate only. Assumes a fixed rate and no fees; lenders often price interest-only higher. Not financial advice.