7 Steps to Saving on Your Mortgage
There are no real secrets
It really comes down to 2 factors:
1. Paying more money into the mortgage
2. Paying this money more frequently
Here are 7 steps to help you save.
1. Do your homework when taking out a new loan. Use the services of a finance broker that has a large choice of loans so that you can compare your options. Make sure you consider all the ongoing fees and charges associated with the loan.
2. Review you current loan every 3 years. New products come into the market regularly. Banks often have special fixed rate loans.
3. Consider the loan combination of fixed and variable. Some banks offer great fixed loans but no competitive variable loans. You need to choose a product or combination of products that is best going to suit your individual needs. A good broker will help you do this.
4. Pay more than the minimum monthly required amount. An extra $100 a month could save you thousands of dollars in interest over the life of the loan.
5. Have your salary paid into your mortgage. Interest on loans are calculated daily, so the less you have in the loan account the more interest you save.
6. Pay your mortgage fortnightly instead of monthly. With fortnightly repayments you make the equivalent of 13 monthly payments a year instead of 12.
7. Consider using a mortgage offset account. Any money in this account will offset interest on your loan account.