5 Ways to Pay Off Your Mortgage Sooner

When buying a home, to live in or as an investment, most people will have the goal of eventually paying it off.

A 30-year loan might seem like a long time to be making repayments, but you won’t be stuck paying interest if you’re able to pay it off sooner.

Here are five ways to help achieve that

Pay Fortnightly: The easiest way to reduce your mortgage is to pay it more often. If you’re making fortnightly repayments instead of monthly, you will be making more repayments over the course of a year and therefore are paying it off sooner.

There are 26 fortnights in a year, but only 12 months.

That might not seem like all that much, but it could save you five years on your mortgage thanks to the power of compounding.

Pay More: One of the best things to spend your money on is reducing debt. If you get a regular bonus from your work, consider putting at least a portion of it into your mortgage.

If you do this every single year, you’ll be reducing the principal component a lot faster and therefore pay less interest. Over time, it will shed years off your mortgage.

Don’t Max Out Your Borrowing: Just because you can borrow your maximum amount, doesn’t mean you should. It hampers your credit score and as a trusted mortgage broker in Sydney, we can tell it isn’t the right way to reach your dream.

If you want to pay off your home faster, you could simply look at buying a home for less than what you are able to service. That way, you can put the additional funds into paying down the loan which will help you pay off the mortgage a lot faster.

Refinance: Another way to reduce your mortgage repayments is to refinance to a new home loan product with a lower interest rate.

That way you can make the same level of repayments but put more towards the principal component. You’ll then be paying off the loan faster. You can use our refinance home loan option and find out how much you have to pay. 

At the same time, you can also look at refinancing and rolling over some higher interest debts, such as car and personal loans, into your home loans. You can then take those savings and put them into your home loan.

Use an Offset Account

If you’re able to budget well, it’s possible to incorporate the use of an offset account into your mortgage planning.

By putting your monthly expenses on credit card and letting those funds sit in your offset account, you’ll in effect have more money to put towards your home loan by saving on interest. Just be sure to pay off the credit card each month.

YFA – A Mortgage Broker in Sydney You Can Trust

Since inception, we have been helping Australians with financial advice that made them successful home owners, car owners and also meet their financial obligations.

Behind our financial advice lies extensive research on myriad options available. However, we always work with transparency. For instance, use the refinancing home loan calculator and find out monthly repayment obligations. There are more tools that you can use.

However, our expert team is always there to help should you need someone to guide you through various options so that you can reach your financial goals confidently.

Speak to our property loan advisor now!

Phone: 1300 YFA BROKER (932 276)
Email: enquiries@yourfinanceadviser.com.au