Buying a home is one of the biggest decisions you can make in your life. If you don’t have the cash to pay the home’s price, you want to take out a home loan from a reputable lender. Home loans can eat up a big chunk of what you make every month so you want to find ways to pay off your loan as quickly as possible. Here are ways to help you make this possible:
Make Fortnightly Repayments
Paying your Captain Cash loans on a fortnightly basis can help you pay off your loan faster than when you repay it on a monthly basis. Divide the repayment amount by two and repay this on the same day every fortnight. This is because a year has 26 fortnights which means you have extra two fortnights to repay your loan than when you repay it in twelve months which leave you with just 24 fortnights.
Pay the Rounded Up Amount
For instance, if you are paying $1700 every month, try to pay $2000. This means you can always make extra payments to pay off your loan fast. Being able to pay an extra dollar every month will decrease the interest that your lender will charge you and you can be free of debt sooner.
Use an Offset Account
Offset accounts can help you in saving money on interest. For instance, you owe your lender $200, 000 and have $10,000 in an offset account. The latter amount will be offset against the amount you have to pay on your home loan and your lender will only charge you interest on $190, 000. While paying less in interest, focus on making bigger repayments. Speaking of offset accounts, consider getting your salary paid into your offset account. While you can access your money frequently, you can be sure that you sit a little when your money sits on this account.
Spend your Bonus on Paying your Home Loan
In case you get a lump sum payment like a work bonus, an inheritance, or tax back, try to pay a part or all of that towards your home loan to decrease the principal amount you owe. Making significant repayments can surely go a long way in decreasing your home loan’s term.
If you can, there are many benefits to making extra repayments. Every extra repayment reduces the principal amount you owe. In turn, the lender will charge you a lower interest.