How To Pay Off Your Home Loan Sooner

When you sign on for that 30 year home loan, it can feel like you will spend forever paying it off.

Fortunately, it doesn’t have to be this way if you are smart with your repayments, and take advantage of the loan features on offer to you.

Here are some little things you can do now that will help reduce your home loan debt quicker:

• Adjust your repayments
  
  Your repayments can be a great tool to reduce your mortgage.
  
  If you add as little as an extra $50 to your minimum monthly repayment, you might be surprised how much you reduce your loan term and interest paid overall.
  
  Another adjustment that will help out is to make your repayments more frequent; that is, from monthly to fortnightly.
   
• Put your salary straight in your loan account or offset
  
  If your loan has an offset or redraw facility that permits this, put your salary straight against the amount you owe on your loan.
  
  These features still give you the flexibility of being able to withdraw extra funds when you need it, while still reducing your loan balance.
   
• Put any extra cash into your next repayment
  
  Got a few thousand back on your tax, inherited some money from a relative or worked some extra hours?
  
  Put all of it (or as much as you can) towards paying off your home loan.
  
  These lump sum repayments can make a huge difference to the amount of overall interest you pay, and take you so much closer to being free of your home loan.

Sometimes it is necessary to make small sacrifices to be able to make larger repayments on your mortgage; however, remember that you don’t need to deprive yourself of all enjoyable parts of your lifestyle! It is best to find a balance between the two