Problems with interest rates and repayments? Ask for home loan help.
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There is no big secret to paying a home loan off quickly. You must pay off more than the scheduled repayments and/or reduce the interest charged.
Paying extra is simple as long as the loan contract allows the option of extra repayments. One simple method of paying extra is to take the required monthly repayment and divided in half and make fortnightly repayments. This will have the effect of making one whole monthly repayment per year because there are 26 fortnights per annum and the effect of this is to shorten the term.
Other strategies include having funds placed in offset accounts or paying in extra but redrawing at a later date when required to reduce the outstanding balance on which interest is calculated.
Having a portion of your loan in a line of credit facility and depositing salary credits to the account and then drawing the salary from the account when required may also reduce interest and term as long as the lender does not charge a premium on the line of credit account.
Having the correct loan structure at the outset is probably the most effective strategy to pay off your loan more quickly and this should be discussed and implemented with input from your mortgage consultant or lender.
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