Total Loan Cost

Does total loan cost include the amount borrowed?

In RealEstateCalc's Loan Comparison Calculator, total cost includes the principal repaid, estimated interest, the upfront fee entered and monthly fees over the full loan term. It is the modelled cash paid towards that loan, not just the price of borrowing the money.

For a separate borrowing-cost figure, subtract the original principal from that total. What remains is estimated interest plus the fees included in the calculation. Check the labels on other calculators and lender documents because they may group these amounts differently.

The calculation behind the label

For a constant-rate principal-and-interest loan with monthly repayments:

Total payments including fees = monthly principal-and-interest repayment x number of months + upfront fee + monthly fee x number of months.

Interest and included fees = total payments including fees - principal borrowed.

This model treats upfront fees as paid separately. If a fee is added to the loan balance, it can also attract interest. Record that treatment separately so the fee is neither omitted nor counted twice.

Worked example: the same loan over two terms

Suppose two illustrative scenarios both start with a $500,000 loan at a constant 6% annual rate, a $600 upfront fee and a $10 monthly fee. These are invented calculation inputs, not advertised products or current market rates.

Estimate	20 years	30 years
Monthly principal and interest	$3,582.16	$2,997.75
Monthly payment including $10 fee	$3,592.16	$3,007.75
Total principal and interest	$859,717	$1,079,191
Upfront and monthly fees	$3,000	$4,200
Total payments including fees	$862,717	$1,083,391
Interest and included fees, excluding principal	$362,717	$583,391

The 30-year scenario has a monthly payment about $584 lower, but estimated payments over the full term are about $220,674 higher. That includes ten more years of monthly fees. Neither column says which repayment fits a household budget.

The monthly repayment uses an annual rate divided by 12 and a repayment at each month's end. Totals use the unrounded repayment; display rounding explains small differences if the displayed cents are multiplied by the number of months. Lender daily-interest calculations and rounding may differ.

Comparing different borrowing amounts

A $400,000 loan and a $500,000 loan repay different amounts of principal. A lower total for the smaller loan does not prove its rate or fees are more competitive.

Start a product-cost comparison with the same principal and term, then change the rate and fees. If comparing different terms intentionally, keep both the monthly payment and full-term totals visible. For refinancing, use the current balance and remaining term as the starting scenario. ASIC Moneysmart warns that extending the new term can increase lifetime interest even when payments fall.

Costs and features outside this estimate

A fixed-rate period is not necessarily the full loan term. A single constant rate cannot describe a later revert rate or future variable-rate changes. An offset balance, extra payments, redraws, early payout, break costs and fees not entered can change the result.

This total also excludes property purchase costs such as transfer duty, conveyancing and inspections. Those belong in a separate property purchase cost estimate. It does not include holding costs, inflation adjustments or tax outcomes.

A comparison rate is a percentage measure, not this dollar total. Enter the loan's interest rate in a repayment calculator and account for fees separately; do not substitute a comparison rate and then add the same fees again.

Related tools and reading

Use the Loan Comparison Calculator for two monthly repayment scenarios. The Mortgage Repayment Calculator shows a repayment schedule. The refinance break-even calculator answers a narrower question about recovering switching costs through modelled monthly savings.

The daily mortgage interest guide explains why a simple monthly model may differ from a statement.

Sources and limitations

• ASIC Moneysmart: Choosing a home loan, for repayment types, term, fees and comparison-rate context.
• ASIC Moneysmart: Switching home loans, for remaining-term and switching-cost checks.
• ASIC Moneysmart: Mortgage calculator, for the limitations of a constant-rate repayment model.

Sources checked 8 September 2026. The table is independently calculated illustrative arithmetic. No government threshold or calculator methodology changes follow from this glossary entry.

General information only. This is not financial, credit, legal or tax advice, a loan quote, approval or recommendation. Obtain current product terms and speak with a licensed professional where appropriate.

Last updated: 8 September 2026.