Mortgage Repayments – Our Top Five Tips to Get Ahead
Taking out a mortgage is one of the most significant financial decisions that you’ll ever make. However, things don’t end there as there’s still the matter of paying your mortgage (as much as we would like to avoid this part of buying a home!).
While it can feel intimidating to have a huge mortgage, paying off your home loan ahead of schedule isn’t as difficult as you may think. Granted, it will require you to plan thoroughly and make certain compromises in order to get it done, but trust us when we say that it will all be worth it in the end. Not only will it make life infinitely easier for you but it will also allow you to invest and grow your money elsewhere.
If you’re interested in knowing more about how to better manage your mortgage repayments, then we’ve got just the thing for you. Here are our top five tips that will help you get ahead of your mortgage payments!
- Get a Handle of Your Finances
When it comes to paying off your loan, it’s important that you understand that the little things matter.
While your other expenses may not have a direct relationship to your mortgage, the way you handle your financial affairs will have a spillover effect on how quickly you are able to pay off your mortgage. This is why you’ll want to do all you can to be as financially responsible as possible.
Now, there are an array of different ways you can go about doing this. Handling your finances is a personal matter and everyone approaches it differently. With that being said, one recommendation that you may like to consider is to cut back on your spending on things that aren’t necessities. By differentiating needs and wants, you’ll be surprised at how much you’ll be able to save. These savings can then go towards paying off your mortgage, which will allow you to pay it off much sooner than expected.
For those of you who need a little guidance, don’t forget that you don’t need to go it alone. If you need tips for managing your personal finances, check out these tips from our personal finance coach!
- Pay Your Other Debts
Another thing you’ll want to do to get ahead of your mortgage payments is to prioritize paying off your other, smaller debts. While it may seem counterintuitive to pay off other debts first, doing so will allow you to prioritize your mortgage payments in the long run. To add to this, paying off other debts (especially those with high interest rates) can help to keep your expenses to a minimum.
Facing all your debts head-first can be a little overwhelming so we suggest setting aside an afternoon to get on top of your money matters. Take this time to plan out how you can take small but productive steps to pay down your debts. Small steps make all the difference when it comes to paying off your long-term mortgage.
- Figure Out the Right Repayment Schedule
Sometimes getting ahead of your mortgage is all about getting the schedule right. By tinkering with your repayment schedule, you could potentially speed up the entire process. There are a number of ways you can approach this, all of which have their own advantages and disadvantages.
Instead of paying monthly, you may want to consider paying half your regular payment every fortnight.
By doing this, you’ll be able to get ahead of your mortgage by at least a month as there are 26 fortnights in a year. While this may not seem like much, it can be a great way to get ahead of your mortgage and lessen the financial burden.
- Rent Out Space
Lastly, one unconventional but effective way to help you get ahead of your repayments is by opting to rent out your space.
Considering that the sharing economy is still growing, renting out your space could be extremely beneficial for you. This is especially true if you have an extra bedroom in your home that you can rent out all year round. For those of you who don’t have space to spare, you can have your home rented out for a couple of weeks if ever you are away on holiday or vacation.
- Refinance Your Mortgage
Financial situations change. There’s a possibility that you may be able to afford more now than you initially could when you agreed to your mortgage.
This is why you may want to consider refinancing your mortgage. Refinancing simply means revisiting and replacing the already existing terms you have with your lender. By refinancing, you can change several different aspects of your mortgage such as the interest rate, payment schedule, repayment terms.
If you really want to get ahead of your mortgage repayments, then you can even opt to take on higher payments to shorten your mortgage. This can effectively shed months, if not years, off your mortgage. We suggest consulting with a mortgage professional before making any drastic changes to your mortgage terms.
When it comes to paying off your mortgages early, the key is to increase your streams of revenue. The extra income that you gain from this can be put towards paying off your mortgage earlier.
Do you Need Mortgage Broking Services in Newcastle?
We hope these tips prove to be useful when it comes to helping you get ahead of your mortgage.
While it may seem like a monumental task, paying off your mortgage is a lot easier than you may think. This is especially true if you’re willing to put in the time and effort to better manage your finances. Indeed, you’ll surely be surprised how fast you’ll be able to pay off your mortgage.
Are you looking for professional financial services in Newcastle? At 123 Financial Group, we have been providing expert financial advice for over 30 years. We have a team of trusted financial advisers who will support and guide you through achieving your financial goals, for the short and long term.
Book an initial consultation with our financial planning team today and take your first step towards financial freedom!