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Pay Mortgage Quicker
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There are only 4 realistic ways
to pay your mortgage quicker and these are;
1. Reducing the interest rate you
pay
2. Reduce the fees you pay
3. Make extra repayments
4. Use your offset or redraw
facility effectively
To show the
cost
effectiveness of using each of these methods we have
provided an example based on a home loan of $250,000 over 25
years.
Reduce the Interest Rate!
Reduce the rate you pay by 0.5%
from 8.07% to 7.57% and…
» SAVE $82 monthly from $1,941 to $1,859
» SAVE over $984 yearly
» TOTAL SAVINGS = $24,600 for the life of the loan
Reduce the Fees!
Find a loan with little to zero
upfront and ongoing fees over 25 years with a similar interest
rate and…
» SAVE $600 plus in upfront fees
» SAVE $2,500 on monthly fees based an a $10 ongoing monthly
charge.
» SAVE between $7,500 and $9,875 in yearly fees with most
professional packages that charge
annual fees from
$300 to $395 a year
» TOTAL SAVINGS = anything from $600 to $9,875 for the life of
the loan
Make Extra Repayments
Here are just a few examples of
how extra repayments can reduce the amount and the term of your
loan.
» SAVE $40,907 by making extra
repayments of $82 a month from the money saved by reducing
your interest rate
by 0.5%.
» SAVE $5,769 by making extra repayments of $10 a month from the
money saved by not
paying a $10 monthly
ongoing fees. Even more if you pay more than $300 yearly for
professional
packages.
» SAVE $54,003 by splitting your monthly payment in two and pay
every fortnight. This equates
to paying an extra
$136 monthly.
Use
the Offset & Redraw Facility Effectively!
Place all your savings and income
into your home loan account and use an offset account and or
redraw facility to use funds for future purchases. When choosing
a loan, make sure that fees are not charged when using either of
these facilities.
An average balance of $10,000 in
an offset or in your loan account over the term of your loan and
you can…
» SAVE $49,715 in interest payments
» REDUCE the term of your loan by a further 2 years and 3 months
To perform these calculations visit our
mortgage calculators
page. There your will find a range of online mortgage
calculators and excel calculators to perform the above
calculations.
For more
information on how you can save on your current mortgage you can
request a free home loan check and we can do all the
calculations for you. Click the link to apply for a free home loan check
If you are looking for a new home
loan please use our online
mortgage quote forms
or contact us
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Pay your home loan quicker
using four simple strategies
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you should ask your mortgage
broker
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refinancing?
Find out the exact costs of
refinancing your home loan.
Beware of the online or
instant pre-approval
Do not get caught in this
trap. You could be in for a
surprise
Fixed or Variable Rate
Loans?
Unsure of whether to choose
fixed or variable rate loan.
This article may help.
Offset Accounts - Advantages
and Disadvantages
How offset accounts work and
the associated costs.
Property Investors
Investment loans for
property investors - Which
one to choose?
First Home Buyers
Information for buying your
first home
Interest Rates
How does the Reserve Bank
set interest rates? Click
the link above to find out
more.
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