Many people simply make their allocated mortgage payment each month, but with a little extra diligence, you can pay off your loan much more quickly. Even as little as $100 extra repayment per month can make a big difference in the long term.
Other tips include.
1. Repay your mortgage more often
By making fortnightly repayments equal to half your minimum monthly repayment, you pay one extra monthly repayment each year. Believe it or not, the impact of this on your loan long term is significant. We can help you work through the numbers based on your circumstances.
2. Contribute lump sums
This reduces the amount of interest you owe and the overall loan term. Annual tax returns, bonuses, windfalls, inheritances – they will all make a difference to what you pay in long term.
3. Consider an off-set account
Home loans with offset accounts give you the best of both worlds, because you can link a savings account to your loan and ‘offset’ (use) that amount to reduce the interest owed. These loans are an excellent way to use your money to its greatest advantage – to assist you with reducing your mortgage, but still providing you with access to funds when you need them.
4. Pay on time
Schedule automatic home loan repayments that come out a day or two after your wages hit your account. This way, you’ll never forget a payment and you’ll never fall behind on your loan, which not only will help you avoid late payment penalties and keep your credit score in check.
Like to crunch some numbers? Call us and we’ll take a look for free. 02 9518 5728
