Pay more, more often.
Want to pay off your mortgage early? Then make bigger mortgage repayments, more frequently. You’ll own your own home sooner and save a bundle on interest.
E.g. paying an extra $10 per week on a $350,000 home loan (@7% average) saves nearly two years off your mortgage and $34,382.65 in interested expenses.
Act now – you pay most interest up front.
Most mortgages are structured so that you pay off most of the interest in the early years. If you are serious about wanting to reduce the interest you pay on your Home Loan, you’ll act now.
Get rid of car loans and credit card debt.
You’re generally paying a higher interest rate on small loans (e.g. a car) and your credit cards so it makes sense to eliminate those debts first. So, put a rein on your credit card usage and then tackle your mortgage.
Make sure you’re paying off the right mortgage.
When you entered the mortgage market, you might not have been as well informed as you are now. Or the market might not have been as competitive. Stay in close contact with with us to stay informed you have the right loan. I can can let you know if there is a new home loan product that will save you money over the term of the mortgage.
Flexible mortgages
Most debt-retirement strategies depend on you being able to pay off more of your mortgage sooner. Read the fine print or talk to us to see if you have the flexibility you need to reduce your interest charges.
Pay more and pay often
Assuming you have a mortgage that lets you pay extra, you should pay more and pay often. The interest charged on a $ 300,000 home loan at a rate of 7.15% over 30 years with monthly repayments is over $420,000. By paying off an additional $50 a month, you’ll reduce the interest bill by $39,000 and your loan term by 2 years and 4 months. You could look at making repayments weekly or fortnightly rather than monthly. Over 30 years the savings add up.
To learn more about paying off your mortage sooner, talk to us today by calling our Centra Money team at 08 8231 4709 or at info@centramoney.com.au
