Although keeping up with your home loan can be quite a challenge from time to time, being able to pay it ahead of schedule will actually help you save thousands of dollars in the long term. But how is this possible? It all lies in the interest you saved. Of course, that's not the only reason you want to pay off your mortgage. By paying your loan off early, you can also avoid the extra interest you have to pay if you keep paying for the loan, which saves you a lot of money over time!
With that being said, if you are interested in paying your mortgage ahead of schedule, here are some tactics that you can use:
1. Make payments more often
If you are financially capable, making payments more often can help you pay off the mortgage much quicker, saving months of extra repayments. For instance, rather than paying monthly, you can choose to pay weekly. This ensures that by the end of the year, you would have paid much more than if you paid once a month. Of course, this means that you're going to end up spending more per month, so make sure it is a feasible idea before trying it out!
2. Increase your payment amount
If you do not want to make more frequent payments, you can consider increasing the repayment sum instead. These additional payments will come right off your loan balance, lowering interest for next month's payment. As such, keep in mind that the more you pay per month, the less interest you will have to deal with, saving you a lot of interest charges.
3. Side-step unnecessary purchases
There are some things in life you need to buy, like food and other necessities. There are also other things you think you need, but they're actually just nice to have, such as purchasing an overly-priced suit or an expensive bottle of water. We're not telling you to live on just water and some bread to save on your spending, but we're telling you to avoid the things you do not need to purchase. Then, the money saved can be directed to pay off your home loan sooner!
4. Get your loans from the same lender
Apart from being more convenient to get your loans from the same lender, there are actually some other benefits of doing so. For example, you can save on various fees and enjoy other promotions, such as interest discounts, that is if you satisfy certain conditions. Likewise, be sure to work closely with your lenders, and if you have any other loan needs, talk with them about what benefits they may have to offer if you get a package loan.
There are many other tactics you can employ to pay off your mortgage faster to save a lot of money. Yet, any effort you make to pay off your loan sooner will go a long way in keeping you on top of your mortgage and saving money. Yes, it will take some time and dedication to apply the tips we've shared above, but it will undoubtedly be worth just how much you'll be able to save once you're done paying off your mortgage!
Wealthy You is an Australian Mortgage Company offering various mortgage solutions to meet varying financial needs in Sydney, NSW. If you are looking for versatile mortgage brokers that can help meet your financial needs, reach out to us today!