Your home loan doesn’t need to hang over you for 30 years. That’s the truth no one tells you when you first sign up. Most people just assume that a mortgage is a lifelong companion. But what if you could ditch it years earlier, and save tens of thousands in the process? Good news: You can. And it’s not about earning more or winning the lottery. It’s about playing smart with what you’ve already got. Here’s how.
Know Your Enemy: Interest
Let’s get one thing clear. The bank makes money off your loan by charging interest every single day. Not yearly. Not monthly. Daily. That’s why even small changes make a massive impact. Cutting the life of your loan by five or ten years isn’t just possible, it’s within reach. Once you understand how interest works, the game changes.
Make Fortnightly Repayments Instead of Monthly
This is one of the oldest tricks in the book, but it works. Instead of paying your mortgage once a month, split that in half and pay it every two weeks. Why? Because there are 26 fortnights in a year. That means you’ll make the equivalent of 13 full monthly payments instead of 12. That extra payment each year chips away at the principal and shortens your loan term.
Effort? Minimal.
Impact? Massive.
Throw Windfalls at Your Loan
Got a tax refund? Work bonus? Sold something online? Don’t blow it. Use it. Every dollar you put directly toward the principal reduces the interest you’ll pay tomorrow. A $1,000 bonus today could save you $3,000 over time. Stop thinking of your mortgage as a bill. Start treating it like a target.
Get an Offset Account and Actually Use It
An offset account is your secret weapon. It’s a bank account linked to your home loan. The money in it "offsets" your loan balance, so you only pay interest on the difference. Have $20K in your offset and a $400K mortgage? You’re only paying interest on $380K. But here’s the catch: it only works if you keep money in it. So stop draining your savings for things that don’t matter. Park your cash here and let it work for you.
Round Up Every Payment
This sounds tiny. It’s not. If your mortgage payment is $1,846, round it up to $1,900. Or better: $2,000. That extra $54 or $154 goes straight to the principal. You won’t miss it. But your loan will feel it. Do this every month and you’ll shave years off your term without feeling the pinch.
Don’t Just Pay What They Tell You
Banks love it when you pay the minimum. It keeps you in debt longer. You? You’re smarter than that. Always aim to pay more than the minimum required. Even $50 extra per payment adds up. Get into the habit of topping up your repayments automatically. No excuses.
Review Your Loan Every 2 Years
Loyalty doesn’t pay when it comes to banks. If your interest rate is more than 0.5% above the average, you’re overpaying. Period. Don’t wait for your lender to offer a better deal. They rarely will. Call them. Ask for a rate cut. Or refinance with a lender who’s offering a sharper rate. A lower interest rate means more of your money goes toward the actual loan, not the bank’s pocket.
Live Below Your Means
Sounds boring. It’s not. Living below your means doesn’t mean cutting out coffee or selling your car. It means making conscious choices. Skip the luxury upgrades. Delay the new gadgets. Take that “extra” money and pour it into your home loan. Every sacrifice now speeds up your freedom.
Make Your Loan Your Top Priority
Your mortgage is probably your biggest financial burden. So why treat it like background noise? Be obsessed with clearing it. Track your progress. Celebrate small wins. Talk about your goals. When you treat it like a mission, everything shifts. Your mindset, your habits, your bank balance.
The Bottom Line
There’s no magic bullet. No secret handshake. But there is a clear path to paying off your home loan faster, and it’s one that real people like you walk every day. Change how you think. Change how you spend. Change how you pay. The freedom at the end? Worth every cent.
What Banks Look For When Approving Your Home Loan?
Read More
The Secret to Paying Off Your Home Loan Faster
Read More
What Banks Look for When Approving Your Home Loan in Australia?
Read More
How to Improve Your Credit Score for a Better Home Loan Rate in Australia
Read More
Is 2025 the right time to buy a house in South Australia?
Read More
Apr 11, 2025
Ultimate Guide to buying your First Home – 10 steps to follow
Read More
Nov 12, 2024
How Trump's Inauguration Could Impact Australia's Housing Market in 2025!
Read More
