How to pay off your mortgage faster

1. Pay fortnightly

If you're currently making monthly payments, consider switching to fortnightly payments. By paying half of your monthly amount every two weeks, you'll effectively be making an additional month's payment each year, since there are 26 fortnights in a year.

Before

$400,000 Loan
4.5% rate
$2,027 per month
30 yrs to repay
$329,523 interest

After

$400,000 Loan
4.5% rate
$1,014 fortnightly
26 yrs to repay
$273,194 interest

2. Make extra repayments

Any extra repayment towards your mortgage can make a difference. You might consider setting up an additional re-occurring payment, or you might transfer a lump-sum from a bonus or tax return. Ask your lender if there's a fee for making extra repayments.

Before

$400,000 Loan
4.5% rate
$1,014 fortnightly
26 yrs to repay
$273,194 interest

After

$400,000 Loan
4.5% rate
$1,314 fortnightly
17 yrs to repay
$168,666 interest

3. Have a budget

Having an effective budget plan is the best way to track your spending. This may allow you to find areas to save money, or even better - additional cash to put into your mortgage. If you don't have a budget, you can download our budget planner here.

4. Lower interest rate

Chat to a mortgage broker or shop around to compare interest rates. If you find a better rate, ask your current lender to match it or consider switching to a new lender. Just make sure the benefits outweigh any fees you may need to pay. If you secure a lower interest rate, keep making the same repayments you had at the higher rate.

Before

$400,000 Loan
4.5% rate
$1,314 fortnightly
17 yrs to repay
$168,666 interest

After

$400,000 Loan
4% rate
$1,314 fortnightly
16 yrs to repay
$139,976 interest

5. Offset accounts

An offset account is a savings or transaction account that's linked to your home loan. Any funds in this account will offset the interest you have to pay. For example, if you have a $400,000 mortgage with $20,000 in your offset account - you're only charged interest based on the amount of $380,000.

Quick mortgage tips

Use online mortgage calculators to find out what you'll save by making higher loan repayments or reducing your interest rate.

Having funds in your offset account is a great way to save for unexpected events that may impact your income.

Home owners should consider investing in effective income protection.

Making higher repayments can help you to be prepared in advance for any future interest rate rises that may occur.

The best time to put extra towards your mortgage is when interest rates are low.

We can help

We hope you found these tips helpful. If you require further assistance with your home loan, our lending specialists at Simplii Finance can help. Contact us to arrange your free consultation.

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All information, calculators, and figures shown are general guides only and do not represent financial advice or a lending offer. Actual deposit amounts, eligibility, and loan outcomes depend on your personal circumstances, lender policies, and current property prices. MWC Property Group provides free, no-obligation assessments to help you explore your options. We act as a facilitator, not a builder or land seller. View Keys & Ease™ Guarantee terms • View full disclaimer • View privacy policy

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