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Mortgages & Home Buying · United States

Interest-Only Mortgage Calculator

Updated on 22 Oct 2026 · Checked by Aotob

Interest-only on $300,000 at 6% is $1,500 a month.

After 10 years it rises to $2,149 to repay the loan in the time left.

Interest-only payment

$1,500a month

Then for 20 years$2,149 a month
A repayment loan instead$1,799 a month
Total interest, interest-only first$395,830
Total interest, repayment$347,515

The lower payment now costs $48,316 more interest overall, and the payment jumps by $649 when the interest-only period ends.

Show the working

300,000 × 6% ÷ 12 = 1,500
Then 300,000 over 240 months = 2,149

What people ask next

What would a normal repayment mortgage cost?with $300,000Could overpaying help?with $1,500 a monthWould refinancing save money?with $300,000What is my loan to value?with $300,000

Both ways

Interest-only firstRepayment
First payment1,5001,799
Later payment2,1491,799
Total interest395,830347,515

Questions people ask

How is an interest-only payment worked out?

Loan × yearly rate ÷ 12. $300,000 at 6% is $1,500 a month, and the balance never goes down.

What happens when the interest-only period ends?

Either the whole loan is due, or it switches to repayment over the years left, so the payment rises sharply.

Who uses interest-only mortgages?

Mostly landlords and people with a clear plan to repay, such as selling another property or an investment. Lenders check that plan.

Related

MortgageOverpaymentRefinanceLoan to Value

Updated 22 Oct 2026Source: Standard loan maths, checked October 2026Checked by AotobFixed rate for the whole term.Report an issue