by Shane Murray – Financial Adviser – https://networkfs.co.nz/about-us/
We asked our in-house Financial Adviser and mortgage specialist, Shane Murray, to share his 5 ways on how you can save money on your home loan and repay it faster.
Here we go!
Tip #1: Make Extra Repayments
“The way you structure your home loan can help you pay less interest and could take years off your mortgage. If your mortgage is floating (i.e. not on a fixed rate), you will be able to make additional loan repayments. This can be from tax returns, bonuses, or commissions you have received. Fixed your Mortgage? Not a problem. When your fixed rate period ends, you can make a lump sum payment to your mortgage prior to re-fixing. The fixed amount is generally a percentage of your remaining loan balance so make sure you check your Mortgage documents for your Mortgage provider’s Terms and Conditions.”
Tip #2: Change Your Frequency of Payments
“Did you know changing your payment frequency can help you pay off your loan faster? Simply changing your payments from monthly to fortnightly will enable you to pay up to an additional one month’s worth of your home loan repayments. This small change can lead to big savings over the long term.”
Tip #3: Pay Fees and Costs Upfront
“There are several costs associated with purchasing a house that may catch some buyers by surprise such as solicitor fees, registered valuations, pre-purchase inspections, etc. Be prepared with an additional $5,000-$10,000 to pay these fees upfront. By doing so, you can save thousands of dollars in interest over the term of your loan.”
Tip #4: Be Vigilant and Look Small
“Shop around and compare! You do not have to get your mortgage with one of the ‘big’ banks. Some smaller banks or credit unions can be just as competitive. A mortgage provider has given you a pre-approval? See what someone else can offer? A mortgage adviser, like myself, can assist you with shopping around and can place you with a lender that is suited to your personal needs.”
Tip #5: It’s The Little Things That Count
“Cut down on your spending. Instead of your daily morning coffee, the weekly Sunday brunch or treating yourself with too many takeaway nights, rather put that money towards your home loan. All these small purchases quickly add up. This does not mean you need to miss out entirely now you have a home loan. Treat yourself to takeaways or coffee once a week and put the rest towards your home loan. Making small changes now can lead to big savings. Future you will thank yourself!”
To discuss how we can assist you with your mortgage needs, whether you’re buying your first home, refinancing, or looking for a top-up on your existing mortgage, please get in touch with Shane on 022 307 1434 or at email@example.com!