Paying your mortgage off faster doesn’t mean squeezing every extra dollar out of your back pocket and living on 2-minute noodles (unless that’s your thing of course). Minor adjustments to your repayments can make a big difference over time, saving you thousands in the long run.
The thing about interest is that it compounds. When you’re saving money, you earn interest on the interest and so on. When you’re repaying a mortgage, this works in reverse – the less you owe, the less interest you pay. Simply put, small increases in your regular repayments will have a massive impact in reducing your interest costs in the long run.
Regularly paying a bit more (even just a small amount like $20 extra per week) can make a significant difference on the lifetime of your loan. Constantly review your budget and see if there are any expenses you can cut down on. Save that daily coffee from the local cafe for retirement!
As soon as you receive a bonus or get a pay rise, pat yourself on the back and then send the additional funds directly towards your mortgage. Sticking to your budget and putting the extra income into the house will help you to cut down the debt without you even noticing.
Don't be afraid to break up with your bank. Moving your mortgage to a different lender could save you thousands in interest, and we can do the rate negotiating on your behalf. You can also get a sweet cash back worth up to 1% of the loan value in some cases.
If you’re on a floating rate, it can be tempting to drop the volume of your payments if interest rates drop. Continuing to pay the same amount will help you out in the long term, especially when the rates rise again. Stay strong!
The sheer size of your mortgage can feel overwhelming. But how do you eat an elephant? One bite at a time. Take a chunk of $20k or $30k and just focus on paying that off as quickly as you can off over a couple of years. That suddenly feels like a more achievable goal.
If your repayments are calculated monthly, choosing to split these into two fortnightly payments is an easy way to help you save. As there are more than four weeks in a month, paying fortnightly could mean that you are paying off an additional month’s worth of mortgage every year, helping you to reduce the principal faster.
The main reason people refinance is to get a better deal. The benefit can be a lower mortgage rate and a cash-back contribution. To make sure it's worth it, you need to weigh up the benefits against the costs of refinancing including break fees and legal costs. What usually makes it worth switching is the cash-back.
A cash-back contribution is a lump sum given to you by the bank at settlement. It can be as much as 1% of the amount borrowed, but depends on what's happening in the market. There are conditions though, and the money can be clawed back within three years if you sell the property or move to another bank within that time.
Not only do we have access to more banks than other brokers, but we have a community of over 5,000 peer-to-peer lenders for a custom solution if you don't quite fit the bank's box.
We'll quickly work out how much you could borrow towards purchasing a home, just tell us a little about your financial situation.
Work out your regular repayments and how quickly you could pay off your home loan.
As rates go up, banks respond at different speeds so there can be a big difference in interest rates at the time of taking action. A mortgage adviser is a great free resource to get you over the line quickly and they're familiar with all of the options available to you. Now, where can you find one of those?
Give us a call on 0800 21 22 30 or fill in our online application.