Paying off your home loan faster can save you thousands in interest and help you become debt-free sooner. Here are some strategies to speed up your home loan repayment:
1. Make Extra Payments
Biweekly Payments: Instead of monthly payments, pay half of your mortgage every two weeks. This results in one extra full payment each year.
Lump Sum Payments: Use bonuses, tax refunds, or any extra income to make one-time payments toward the principal.
Round Up Payments: If your mortgage payment is 8000 Rs, round it up to 10,000 Rs or more.
2. Refinance for a Shorter Loan Term
If you can afford higher payments, refinancing to a 15-year loan can save you a lot in interest and pay off the loan faster.
Look for lower interest rates to reduce costs.
3. Increase Monthly Payments
Add a fixed extra amount to your monthly payment and ensure it goes directly to the principal. Even 8000 Rs extra per month can shave years off your loan.
4. Apply Windfalls & Savings
Tax refunds, work bonuses, or unexpected cash inflows should go toward your mortgage.
If you reduce other expenses, redirect those savings to your loan.
5. Avoid Unnecessary Fees & Costs
Watch out for prepayment penalties (some lenders charge fees for paying off loans early).
Ensure extra payments apply to the principal, not just interest.
6. Reduce Other Debts
If you have high-interest debts (like credit cards), pay them off first. This frees up more money for your mortgage.
7. Rent Out a Room or Property
If possible, consider renting out a portion of your home and using the income toward mortgage payments.
Would you like help estimating how much time or money you could save with extra payments?
0 Comments