Expert tips on how you can repay your home loan faster, while saving money.
As a mortgage loan is probably the single, biggest loan you will ever apply for, we should probably start off with the secrets that will help you repay a large amount with some financial savvy. This is how you can repay your home loan faster.
Make extra repayments
This is probably the most obvious way to pay back your home loan faster. These repayments should be scheduled throughout the month for optimal saving on interest.
Make additional repayments from the start
Making repayments from the start and drastically change the time you spend repaying your home loan. Remember, the idea is to lower the principle amount, which allows you to lower the amount of interest that accumulates.
The more repayments, the better
Naturally, the more repayments you make, the more you will save. This is one method that allows you to beat the interest rate on your loan, save money and time repaying you home loan.
Find a cheaper interest rate
Always shop around for cheaper interest rates. Should you find a cheaper interest rate, it will once more allow you to save on the principle amount of your loan. With the amount of home loan lenders available, there are always cheaper rates out there.
Cover the additional fees
The actual loan amount is not the only fees that will make up the principle debt of the loan. It is advisable that you pay all other fees upfront to avoid having to increase the principle amount, which will, as a result, increase the interest charged to your loan.
There are so many home loan lenders available today.
As a home owner, you should always be looking at improving on your current home loan repayment plan. One such way is to always negotiate the best fees and interest rates on your home loan. This should be done throughout the duration of your home loan repayment.
Redirect funds to your home loan
Throughout the time that you spend repaying you home loan, you will receive additional funds. Whether it be yearly bonuses, returns from investments and alike, redirecting these funds to your home loan can help you save a lot in the long run.
Another great tip is to use your bond account as a savings account. You are still able to withdraw the additional funds but you are sustaining a lower principle amount and therefore saving on interest.
Make a falling interest rate work for you
If you do not have a fixed interest rate, you could take advantage of a falling interest rate. This would mean that the scheduled repayment amount might decrease; it is at this point that you should capitalise on a lower interest rate and redirect the saving on your repayment back into your home loan. It is a very efficient way of saving money when repaying your home loan.