22 Dec 2003

Get rid of your loans and live debt-free

If you have debt, getting rid of it as soon as possible is critical since the longer you owe money, the more you wind up paying in interest on your existing loan total.  

Paying off your mortgage early will save you money and relieve you of its burden. Here are some tips for paying off your mortgage faster. 

5 Easy Ways to pay off your debt sooner 

1. Make additional repayments

Extra repayments on your mortgage can cut your loan by years. Putting your tax refund or bonus into your mortgage could save you thousands in interest. 

On a typical 25-year principal and interest mortgage, most of your payments during the first 5-8 years go towards paying off interest. So anything extra you put in during that time will reduce the amount of interest you pay and shorten the life span of your loan. 

Before making any additional payments, reach out to a Fast Repay Home Loan expert to avoid getting penalized for making extra payments without planning for them.

2. Increase your repayment amount  

Another way to get ahead on your mortgage is to make repayments as if you had a loan with a higher rate of interest. The extra money will help to pay off your mortgage sooner.  

If you switch to a loan with a lower interest rate, keep making the same repayments you had at the higher rate. If interest rates drop, keep repaying your mortgage at the higher rate. 

This is how you pay less interest and save more money. 

3. Increase the occurrence of your repayments 

Because interest is computed daily, the more frequently you make repayments, the less interest you will have to pay. Increase the frequency of your repayments as well as the quantity of your repayments if you wish to have a bigger impact on your loan. Switching to biweekly installments (to coincide with when you get paid) instead of monthly repayments can make a big difference, especially if the fortnightly repayments are exactly half of the monthly repayment amount. 

4. Put any extra money into loan repayments 

If you’ve received any bonus cash - like a tax refund for instance – pay it out towards an additional repayment on your loan rather than spending it. 

Contact Fast Repay Home Loan specialists for advice on managing your debt. 

5. Consider a debt consolidation loan 

Paying one loan off is fairly straightforward - but what if you have multiple debts you want to get rid of? A debt consolidation loan allows you to roll all your debts into one single loan with one monthly repayment. This makes your debts easier to manage because you have only one due date to remember, it could also save you money if the interest rate on the debt consolidation loan is substantially lower than the interest rates on other debts. Be careful not to turn short-term debts into long-term debts, because that could cost you more. 

Eliminate your debt 

No one likes being in debt, so follow our steps to relieve that burden. Make sure you have a clear picture of how much you owe, work out how much you can afford to repay and start making additional and more frequent repayments, if your loan type allows it. 

If you’re really struggling with managing your debt, remember that you can always reach out to a Fast Repay Home Loan for loan repayment advice. You will be offered guidance on how to get rid of your personal loans and how to start living debt-free. 

Disclaimer: Information included in this post is of general nature, it has been prepared without taking into account your specific situation. It is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. You should not make any decision, financial or otherwise, based on any of the information presented here without undertaking independent due diligence and consultation with a professional accountant or financial adviser.

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