How to Pay Off your Mortgage Quicker

May 2, 2023

For many homeowners, paying off your mortgage faster is a top priority. By paying your mortgage off sooner, you can save thousands of dollars in interest and become debt-free sooner. We’ve compiled some tips to help you pay off your loan quicker:

Increase your repayment frequency

One of the easiest ways to pay off your mortgage quicker is by increasing your repayment frequency. Instead of paying your mortgage monthly, consider switching to fortnightly or weekly payments. By doing so, you’ll make more payments over the course of a year, which can help you pay off your loan faster and reduce the amount of interest you pay.

Make extra payments

Another way to pay off your mortgage quicker is by making extra payments. Any additional payments you make will go directly towards reducing your balance and the amount of interest you pay. Consider making lump sum payments whenever you have extra cash, such as a work bonus, inheritance, or tax refund. Keep in mind that depending on your agreement terms, you may be charged a fee for paying a lump sum.

Refinance your loan

Refinancing your mortgage can be a great way to save money and pay off your mortgage quicker. By refinancing your loan to a lower interest rate, you can reduce your monthly payments and the amount of interest you pay over the life of your loan. However, it’s important to carefully consider the costs of refinancing and ensure that it makes financial sense for your situation. Chatting to a good broker can help you find the best option.

Shorten your mortgage term

Shortening the term of your mortgage can also help pay it off faster. By choosing a shorter mortgage term, such as 15 or 20 years instead of 30, you’ll make larger payments each month, which can help you pay off your loan faster and save on interest costs. Of course, this depends on your financial situation and whether you’ll be able to service a higher dollar amount each payment.

Paying off your mortgage quicker is possible with the right strategies and mindset. These options all depend on your financial situation, so always make sure to consult with a financial advisor before making any big decisions. The SM Property team can give you some great recommendations for brokers and financial advisers. Click here to chat to one of the team about your options. For more tips and tricks on home buying and property, head to our Instagram.

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