Looking to pay off your mortgage a bit faster? Here’s some tips

Whilst there has been a lot of negative impacts on everyday Aussies from Covid-19, one good thing is the record low interest rates. Your home is generally the biggest expense in your entire life, so while lower rates may not seem exciting, they might actually save you thousands.

So how do you make the most of this?

 

Firstly, you should seek professional advice. Shopping around for the perfect home loan is more than just looking at the best rate; it’s important to look for packages that have features you need and suit your personal circumstances. Getting advice from an experienced loans specialist can save you time, stress and confusion with this process, as well as saving you money in the long run.

 

Second, pay more money more often. While it may seem tough making extra repayments or higher repayments, interest on a home loan accumulates by day so cutting down the duration of your loan can mean saving more. Paying weekly instead of fortnightly, or paying lump sums when you receive a bonus will help pay the loan quicker and reduce the interest you pay.

 

Third, refinance your home loan or renegotiate your interest rate. Giving your bank a call and threatening to leave can sometime result in a drop in your interest rate. This can save thousands over a few years so it’s definitely worth a shot. Otherwise, consider refinancing your home loan. While interest rates are so low right now, it’s the perfect time to look at your other options. Mortgage brokers and lending specialists can do quick calculations to see if it would be worth doing, but if your interest rate is anywhere over 3.5% it will probably be worth it!

 

Finally, consider seeing a financial planner. Experienced financial planners can take a look at your financial situation and help implement goals and a method of achieving them. Getting advice from a financial planner as to what moves you should make with your funds can help you save in other aspects of your finances to ensure you’re making the best financial decisions and can live sustainably while making increased payments or changing loans.  Plus, they can help you decide how to navigate your finances once your home loan is paid off – where should you put extra funds and how should you handle your assets?

 

Need advice from a financial planner or loans specialist? Or both? Give us a call on (02) 4920 7886 and book in with someone today!

 

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