October 10, 2017
Paying off your home loan and owning your home is easier if you follow these tips. Pay often, pay as much as you can and have your money work for you. Sounds easy, well it can be if you try the following 5 tips.
1. Have your mortgage broker check your home loan interest rate is competitive, regularly.
Have a home loan heath check. If your home loan lender charges a high rate, you’re behind the eight-ball from the beginning. Some fixed rate home loans are as low as 3.69% at the moment.
Let Mortgage Choice in Mudgeeraba check you numbers and make sure you are on a good rate. This service is at no cost to you.
2. Pay a bit extra
One of the quickest (and easiest) ways to pay off your home loan sooner is to pay a little extra off your loan every week, fortnight or month.
Simple habits like rounding up your monthly repayments to the nearest $10, from say $1,490 to $1,500, can be a budget-friendly way to make additional repayments.
Also you may like to have a monthly budget for living expenses and anything not spent goes into the home loan. If you have a redraw facility on your home loan then if you have an unexpected event arise you can still access the money.
Chat to our mortgage brokers and make sure your home loan has the features that have the flexibility that is right for you. Maybe a split home loan would be a successful way of achieving your financial goals.
3. Pay fortnightly
This is an easy option. There are 26 fortnights in a year and 12 months. So by paying half your monthly repayment 26 times a year is the equivalent of paying 13 months.
Paying monthly you would only pay 12 times in the year.
By paying your loan fortnightly instead of monthly, you’ll make the equivalent of an extra month’s payment.
Check out our online Fortnightly Repayments calculator to see how much you could save.
4. Put lump sums to work
Paying occasional lump sums of cash like your tax refund or annual salary bonus into your home loan can make a significant difference to your loan balance.
Not convinced? Use our Lump Sum Payments calculator to understand just how much more bang for your buck a lump sum can offer when it’s used to pay down your mortgage, or give us a call. We will happily talk through different senarios with you.
5. Have your money work for you
Got some spare cash? Why deposit it into a savings account paying 2% p.a. interest when you could use the money to pay down a home loan which is costing you 4% p.a. or more?
Having an offset account that helps you save on loan interest while giving you access to your savings.
Our mortgage brokers at Mortgage Choice in Mudgeeraba will explain more about the pluses of an offset account and whether it is right for your needs.