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Pay Off Your Loan Sooner
We can help you pay off your loan sooner, helping you achieve financial freedom or giving you equity to reinvest back into the market. Our team of mortgage brokers can help make this dream a reality, so you can achieve your financial goals sooner, rather then later.
How To Pay Off Your Loan Sooner?
Paying your loan off sooner doesn’t have to involve drastic cuts to your lifestyle and monthly surplus cash flow. Incremental extra repayments made consistently can have a dramatic impact on the life of your loan. For example, if you have a Principal and Interest loan of $500,000 over 30 years with an interest rate of 3.50%, making an extra repayment of $200 per month could shave four years off the life of the loan and save you $46,497 in interest.
Offset accounts
An offset account is a transaction account that’s linked to your home loan account. It can provide you with more flexibility and potential savings as it means that instead of being charged interest on the full loan balance, interest is charged on the loan balance minus the amount that’s in your offset account.
Redraw facility
A mortgage with a redraw facility is specifically designed to allow you to make additional repayments and redraw them at another time if you need to. This gives the benefit of allowing you to make extra payments and reduce the amount of interest you pay overall, while giving you the freedom to withdraw the money back out of your mortgage should it be necessary.
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Repayment frequencies
Many people pay off their home loans on a monthly basis because they get paid monthly. However, it is possible with some loans to make mortgage repayments on a fortnightly or weekly basis, and this could cost you less over the term of your home loan. When you make your repayments fortnightly, you end up paying an additional month per year due to there being 26 fortnights annually, not 24. Essentially, this means that you might not only save money in the long run, but you might also reduce the time you pay off your mortgage.
Extra repayments
If you have a variable rate mortgage loan, you may be eligible to make extra repayments on your loan. Sometimes, lenders will cap this at a certain amount, however, the more money you’re able to pay into your loan, the quicker you’ll be able to pay it off.
Our repayment’s calculator can help you figure out how much extra repayments you can make, and what it will save you.
Although we have outlined some basic debt reduction strategies above, it’s best to speak with an Inovayt mortgage broker to develop a personalised strategy to suit your circumstances.
Helpful resources
Looking to pay off your loan?
Our calculator helps you calculate your repayments, giving you the ability to budget and save on interest!
