How to Pay off Your Mortgage Quickly

Is there are a best way to pay off your mortgage quickly?

Here are the five most practical tips to pay your mortgage faster. Number one simple fact is that the more you pay towards the principal amount or the actual money borrowed, the less you pay towards the interest and the faster you pay off your mortgage.

Tip 1: Make extra payment towards the principal amount of your mortgage

This will reduce the overall interest you pay and make your repayment much faster. If you have extra money, just go to your bank and make a payment. Make sure that you tell them it is principlal payment, so that they don’t apply it to your next monthly repayment.

Tip 2: Make arrangements with the bank to pay bi-weekly instalment

This will allow you to make 26 bi-weekly payments, which equals to 13 payment a year, rather than 12 payments a year. The bottom line is that you make repayment quicker and save money on interest.

Tip 3: Re-mortgage your home to a lower rate

Mortgage right now are very low, but some people find it too complicated to go through the tedious re-mortgage process. However, it can save you tens of money, if you choose a lower rate mortgage. Use online re-mortgage comparison sites and you will be amazed to see how much money you can actually save.

Tip 4: Use low interest rate credit cards to reduce your interest on mortgage

There are a lot of credit card offers which will help you to borrow money on lower interest and make advance payment towards the principlal amount of your interest. For example, if you get 5000 advance credit from a credit card with 0% interest for a year and 1.5% admin fee and you pay towards your higher interest rate mortgage, you will save a sizeable amount of money. Make sure that you repay to your credit card company within the stipulated period, so that you don’t end up paying more.

Tip 5: Use and offset account to lower your interest

Offsets accounts are saving accounts linked to your mortgage. The amount in you offset account bal-ance, lowers your interest and you can pay your mortgage quickly. A typical example of an offset ac-count is that for a $300,000 mortgage, $15,000 in your offset account means your interest rate will be based on $300,000 - $15,000 = $285,000.