Ooba Extra Bond Repayment Calculator

Bond Repayment Formula:

\[ New\ Balance = P - Extra \] \[ M_{new} = New\ Balance \times \frac{r \times (1 + r)^{n_{remaining}}}{(1 + r)^{n_{remaining}} - 1} \]

Original Principal (P):

ZAR

Extra Payment (Extra):

ZAR

Annual Interest Rate:

Remaining Months (n_remaining):

months

New Balance (Remaining Principal):

New Monthly Payment (M_new):

Unit Converter ▲

Unit Converter ▼

From:	To:

1. What is the Ooba Extra Bond Repayment Calculator?

The Ooba Extra Bond Repayment Calculator helps homeowners calculate their new monthly bond repayment after making an extra payment toward their home loan. This tool uses ooba's methodology to provide accurate repayment calculations.

2. How Does the Calculator Work?

The calculator uses the bond repayment formula:

\[ New\ Balance = P - Extra \] \[ M_{new} = New\ Balance \times \frac{r \times (1 + r)^{n_{remaining}}}{(1 + r)^{n_{remaining}} - 1} \]

Where:

\( P \) — Original principal amount (ZAR)
\( Extra \) — Extra payment amount (ZAR)
\( New\ Balance \) — Remaining principal after extra payment (ZAR)
\( r \) — Monthly interest rate (decimal)
\( n_{remaining} \) — Remaining loan term in months
\( M_{new} \) — New monthly payment amount (ZAR)

Explanation: The formula calculates the amortization of the remaining balance over the remaining loan term at the given interest rate.

3. Importance of Bond Repayment Calculation

Details: Making extra bond payments can significantly reduce your total interest paid and shorten your loan term. Accurate calculation helps in financial planning and understanding the impact of additional payments.

4. Using the Calculator

Tips: Enter the original bond amount in ZAR, the extra payment amount in ZAR, annual interest rate as a percentage, and remaining loan term in months. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: How do extra payments affect my bond?
A: Extra payments reduce your principal balance, which decreases the total interest you'll pay and may shorten your loan term.

Q2: Should I reduce the term or the installment?
A: Reducing the term saves more interest over time, while reducing the installment improves monthly cash flow. The calculator shows both options.

Q3: Are there penalties for extra bond payments?
A: Most South African bonds allow extra payments up to a certain limit without penalties, but check your specific bond agreement.

Q4: How often can I make extra payments?
A: This depends on your bond terms. Some allow monthly extra payments, while others may have restrictions.

Q5: Does the interest rate change affect the calculation?
A: Yes, if your interest rate changes, you'll need to recalculate using the new rate. This calculator assumes a fixed rate for the remaining term.