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7 tips to pay off your mortgage faster

24 May 2010

Reduce your mortgage with these simple tips

Pay off your house loan faster with these seven simple tips

1 Make your loan repayments weekly or fortnightly

Interest is calculated daily so any payments made before your monthly payment is due will reduce the principal amount which will reduce the interest and mean that you’ll pay the loan faster.

2. Pay more each payment

It doesn’t have to be much but adding as litter as $20 per week to your repayments will make a difference.

3. Make lump sum payments

What to do with that tax refund? Put it into your mortgage account to reduce principal and interest charged.

4. Deposit some of your pay into your mortgage

If you struggle to budget, organise a direct deposit from your pay into your loan account with the balance going into your everyday living account. If you don’t see it, you don’t spend it.

5. Consolidate your debt

If you have a credit card or cards, a personal loan and a car loan, consider consolidating all these into a variable portion of your home loan.

6. Make use of the interest free period on your credit card

Consider taking advantage of the interest free period on your credit card to pay for your monthly household and living expenses then use your redraw for your loan payment when your credit card statement arrives.

7. Refinance your mortgage

If your circumstances have changed (and whose hasn’t with the interest rate rises?), think about switching your loan to a better option that will work better for you.