Owning a home is a significant milestone for many and we feel very privileged to assist along the way. Home lending at the core is generally a 30 year commitment which can be more than a little intimidating. Let us show you how wonderfully simple it can be to pay down your lending and reduce the total loan term.
Round Up Your Repayments:
An easy yet effective way to accelerate your mortgage payoff is by making an extra payment on top of your regular repayments.
Let’s breakdown the numbers!
Scenario – Introducing our first home buyers Scott and Ella
Lending of $500,000
Interest rate of 6.65%pa (assumed for the total term of the loan)
Total loan term = 30 years
Scott and Ella want to pay off their home loan quickly and reduce the total number of years it will take them to be mortgage free. They decide they can afford a maximum of $130 per week on top of their regular weekly repayment of $740. Thus making their total increased weekly repayment $870.
This will save them 10 years off the total loan term meaning in just 20 years they can make their very last mortgage payment and a shocking $251275 in interest!
As you can see a little bit goes a long way.
Making extra payments to your minimum repayments not only helps reduce your principal balance faster but also establishes a habit of consistently paying more than the baseline required. This disciplined approach to mortgage repayment will pay dividends in the long run, putting you on the fast track to financial freedom.
2. Make Lump Sum Payments Whenever Possible:
Another effective strategy for paying off your mortgage early is to make lump sum payments whenever you have additional funds available. This could include bonuses, tax refunds, inheritance, or any other windfalls that come your way. Instead of splurging, consider allocating these funds towards reducing your mortgage principal.
Even relatively modest lump sum payments can make a significant impact on your loan term. For instance, applying a $2,500 lump sum payment every year towards a $500,000 mortgage at a 6.65%pa interest rate can potentially save you over approx. $131,000 in interest and shorten the loan term by 5 years.
Early / extra repayments on your mortgage is a smart financial move that can help you save money and achieve your goals to abolish your home lending. Take control of your finances today and start implementing these simple strategies to accelerate your journey towards homeownership. Give us a call…we are here to make the process easier and to help you achieve your property dreams.

Article Published by Lili Rhodes
Lili Rhodes gives financial advice through Jessica Pronk Financial Services Limited trading as The Mortgage Supply Co