Last Updated: 15th May, 2024

If you are borrowing $500,000 for a home loan and want to understand what your monthly payments and other costs will be, this guide has you covered. We’ll break down the key details, like interest rates, required deposits and additional costs involved around a home loan of this size.

$500K Mortgage Repayment Calculator

How Much Will You Pay Per Month On A $500,000 Home Loan?

Your estimated monthly repayment for a $500,000 principle-and-interest home loan would be around $3000 for a 30-year loan with an interest rate of 6%, if you have no debt complications.

Keep in mind that your monthly repayment depends on factors like interest rate, loan term, taxes and insurance.

Here is a table showing your monthly principal-and-interest repayment for a $500,000 home loan at 5%, 6%, and 7% interest rates.

Loan Term (Years) 5% Interest Rate ($) 6% Interest Rate ($) 7% interest rate ($)
15 3,953.97 4,219.28 4,494.14
20 3,299.78 3,582.16 3,876.49
25 2,922.95 3,221.51 3,533.90
30 2,641.11 2,997.75 3,326.51

How Much Deposit Do You Need For A $500K Home Loan?

You would need a deposit of $125,000 for a $500K home loan. Most lenders typically require a deposit of at least 20% of the property value. So, if you’re buying a property priced at $625,000, you will need a loan of $500,000 and $125,000 as a deposit.

There are lenders that will lend up to 95%, however, (including the Lenders Mortgage Insurance) of the property price, provided you fulfil their requirements.

With a guarantor, you’ll be able to borrow up to 105% without a deposit.

Please note that the deposit value excludes stamp duty and other fees that lenders require you to pay. Read below for the additional cost.

Additional Mortgage Costs To Consider

In addition to the deposit, lenders expect you to have 5% of the property cost. This is to cover the additional costs of buying a home, like stamp duty, mortgage fees, and registration fees.

This calculates to an additional cost of $25,000 for a $500,000 home loan.

How Much Do You Need To Earn For A $500K Mortgage?

You will need to have a $120,000-$150,000 gross salary for a $500K home loan. This is assuming that you don’t have any debts.

    Please note that this is a rough estimate and can vary depending on several factors:

  • Debt-to-Income Ratio (DTI): Lenders assess your debt obligations relative to your income. Typically, they prefer a DTI of 6 or below.
  • Deposit size: A larger deposit (ideally 20% or more) lowers the loan amount and your monthly repayments, making it easier to qualify.
  • Interest rates: Interest rates affect affordability. A lower rate translates into lower monthly repayments.

What Process Is Involved In Getting A $500K Home Loan?

Securing a $500,000 home loan involves several steps. Here’s a brief overview: