10 Easy Ways to Pay Off Your Mortgage Faster in Australia
Owning your home outright sounds pretty great, right? While a mortgage might feel like a never-ending commitment, there are some simple strategies to help you get ahead and pay it off sooner. The best part? You don’t need to live off two-minute noodles to make it happen.
As a mortgage broker, I’ve helped plenty of Aussies get the most out of their home loans. Here are my top tips to shave years off your mortgage and save big on interest.
1. Switch to Fortnightly Repayments
One of the easiest ways to get ahead is switching from monthly to fortnightly repayments. Why? Because there are 26 fortnights in a year, so you’ll be making the equivalent of one extra monthly repayment each year without even noticing. That small change alone can cut years off your loan!
2. Make Extra Repayments When You Can
Got a tax refund? A work bonus? Even just an extra $50 here and there? Chucking those extra dollars straight onto your mortgage can seriously reduce the interest you pay. It doesn’t have to be massive amounts—every little bit adds up over time.
3. Use an Offset Account
If you’re not already using an offset account, you could be missing out on big savings. Any money sitting in this account reduces the amount of interest you’re charged on your loan. So instead of keeping your savings in a regular account, park them in your offset and watch the interest savings stack up.
4. Round Up Your Repayments
Here’s an easy trick—if your repayment is $1,840 a month, round it up to $1,900 or even $2,000. You won’t feel the difference too much, but over time, those extra payments will help clear your loan faster.
5. Find a Lower Interest Rate
When was the last time you checked if you’re on the best rate? Lenders change their offers all the time, so it’s worth reviewing your loan regularly. A small rate drop could save you thousands over the life of your loan. If you need help comparing rates, that’s where a mortgage broker (like me!) comes in handy.
6. Take Advantage of a Redraw Facility
If your loan allows it, making extra repayments into a redraw facility is a great way to pay off your mortgage faster while keeping access to your money if you need it. Think of it as a backup savings plan that still helps you get ahead.
7. Ditch Interest-Only Loans (If You Can)
If you’re on an interest-only loan, you’re not actually paying down the amount you owe—you’re just covering the interest. Switching to principal-and-interest repayments means you’re reducing your actual loan balance, which is what really matters in the long run.
8. Don’t Let Lifestyle Creep Get You
Got a pay rise? That’s awesome! But before you upgrade your car or splurge on a new wardrobe, consider bumping up your mortgage repayments instead. Keeping your expenses the same while putting extra cash into your home loan is one of the easiest ways to pay it off early.
9. Refinance and Consolidate Debt
If you’re juggling credit cards or personal loans with high interest, rolling them into your mortgage could save you heaps. Just be smart about it—keep your mortgage repayments at the same level so you don’t end up stretching your loan out for longer than necessary.
10. Watch Out for Hidden Fees
Some home loans come with sneaky fees that can add up over time. Things like annual package fees, redraw fees, or break costs when refinancing. Always check what you’re paying and see if there’s a better deal out there.
Final Thoughts
Paying off your mortgage faster isn’t about making huge sacrifices—it’s about being smart with your money. Even small changes can make a massive difference over time. If you’re keen to chat about your options, I’m here to help.
Want to see how much you could save? Let’s talk!
The Team at The Accountants and The Finance Brokers are here to help you navigate your cash flow requirements in your business. We offer complimentary cash flow reviews and assist you in understanding your finance needs.
