Friday, April 01, 2005

Getting on Top of your Mortgage

Loan Reduction Strategies to help you pay off your Mortgage

Getting on top of your mortgage so you can pay your loan off faster and potentially save thousands of dollars on your home loan is possible with a plan and consistent effort. There are mortgage reduction strategies that you can put into place that will ensure that your loan is paid off more quickly without putting a huge strain on your current budget. The following tips are designed to help you pay off your mortgage as quickly as possible.

1. One of the most important things you can do to accelerate paying off your mortgage is to make a more frequent repayments. If you can arrange to make weekly payments as opposed to monthly payments you'll actually end up making the equivalent of 13 monthly payments each year instead of 12 therefore saving you money by reducing the term your loan. In order for this to be effective it is important that you make sure that your home loan has interest that is calculated daily. You do not want a home loan that calculates interest on an average monthly balance.

2. The second thing you should do to speed up paying off your home loan is to make extra payments whenever possible with any extra money but you might come by. For example you might use your tax return, a bonus from work, or an inheritance to make an extra lump sum payment on a loan. This will go a long way toward reducing the principal of your loan. If your loan has a redraw facility you will have the flexibility of being able to access these extra payments if necessary.

Getting on Top of your Mortgage continued here...

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