Now I’m not interested in location specific guides and taxation loop holes. Anyone can utilise these tips and make them work. It also goes without saying- there is no miracle way to cut a 30 year mortgage in half, nor a special pill you chew 3 times daily. With just a little bit of work on your behalf you can potentially save thousands upon thousand in interest with a goal to being mortgage free sooner.
My number one, easy as pie way to be mortgage free sooner is to ask for a discounted interest rate. Pick up the phone now and call your bank, your mortgage broker and that little credit union down on the main street corner, and simply (courteously) ask them for a better rate. This literally takes seconds to do and can save you big dollars. Don’t forget to put the extra you save back onto the loan!
No need to switch to weekly repayments- save the hassle. Instead, transfer any left over, surplus money back onto your home loan every week or day if you can. Be it $10 or $20, more if your lucky, every little bit counts when you want to be mortgage free.
If tip number 1 didn’t go too well for you consider another lender. Here I’d usually recommend a mortgage broker, but if you know what your doing but you can potentially secure a better deal with lower repayments and a better term. Always make sure to check the outgoing and incoming lenders fee and charges- It may be just not worth it.
Consider this- Do you need that cheque book or that line of credit? Chances are that your paying extra for them. What suited you 2-3 years ago could now not be necessary, so why pay for it? Also consider integrating any other debt into the new facility. This sounds contrary to the whole “mortgage free sooner’ mantra but debt at 7% is a lot better than the same debt at 20%+.
Make a habit of checking your mortgage statement. You’ll want to make sure all the extra little contributions your making from the above tips are working for you and coming off the principle amount owed. Even banks make mistakes so it pays to stay on top by checking once a month.
Depending on just where in the world you are, rates can be as low as 2% (here in Australia its more like 7%). I know it’s not always possible but whenever you can, larger lump sum payments can make a massive difference. It could be your upcoming Christmas bonus, tax refund or Melbourne Cup win- pay down your loan and be mortgage free faster.
By now you should be well on your way to being mortgage free sooner. Check out our mortgage calculators to see just how many years you can take off with these handy hints. Paying off your mortgage early isn’t for everyone, and in some cases it’s just not possible. But if you can, owning your own home and living a mortgage free life will be worth all of the hard work and sacrifice.