Three tips for paying off your home sooner
Not only can you save money by cutting down on the interest you will be required to pay, but can also become debt free faster.
The great thing is that there are a few simple steps you can take now in order to start chipping away at your mortgage and get on the path to financial independence. Here are three examples.
Increase the value of your repayments
If you are finding it fairly easy to keep up with your compulsory loan repayments, and want to start paying off your mortgage faster, why not try refinancing your loan to increase the value of your ongoing payments?
Try having a play around with a mortgage calculator, and see for yourself how big an effect even a slight increase in the value of your repayments can have. An extra $50 a week could help you shave years off your mortgage!
Make voluntary payments
If you're not willing to commit to paying off more of your loan week in and week out, you can always make a few voluntary lump sum payments in order to knock off big chunks of your debt more quickly.
This is a great option if you happen to run into a bit of money that you were not expecting, such as a Christmas bonus or an inheritance from a relative. Rather than spending this money frivolously, you could put it towards your loan!
Refinance to a better interest rate
A mortgage refinance allows you to change home loan providers, transferring the debt on your current property to a different lender. Alternatively, refinancing can allow you to change the terms of your existing loan, for example, by switching from a fixed loan to a variable loan, or vice versa.
Why would you do this? Well, because it can lead to you securing a better interest rate of course! Not all home loans will allow you to refinance in this manner, so it's worth talking to an expert. However, when done correctly, refinancing your home loan might help you save a significant amount of money in the long run.