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Smash your mortgage!

Smash your Mortgage

Online Mortgage BrokersWith house prices reaching record-high levels, the amount of debt that homeowners are taking on is a lot higher than previous generations which means we need to pay extra attention to our own personal finances.

NZ has had low-interest rates for a while now and while these rates are low, it is the best time to take advantage and make significant gains in reducing the amount of your mortgage. How do we do this? I hear you ask, well read on for a few simple tips.

Review your loan Structure

Is your entire loan fixed into one interest rate? Do you have the ability to make extra payments? Have you thought about using your savings or day to day accounts to reduce the amount of interest you pay? The way you structure your lending is pivotal to how quickly you are able to pay off your debt.

Minimising interest and being smart will literally save you thousands of dollars, probably hundreds of thousands.

Lump sum repayments

A lump sum repayment can make a significant difference to the amount of interest you are required to pay on your mortgage. If you’re fortunate enough to finish each month with a surplus, can you use some of that money to put towards your mortgage? Will you receive a bonus or expect a tax refund at the end of the financial year? If so, can this be put towards your mortgage?

Has your income & expenses changed and do you have a plan?

We would recommend reviewing your personal finances at least every year. If your situation or lifestyle has recently changed, perhaps a new job, child, or you want to plan a holiday, then now is a good time to review your income and expenses.

Check that your existing mortgage still meets your needs and is competitive – both in terms of the interest rate you’re paying and the amount of flexibility you have in making additional repayments. You need to ensure that you are in charge of your mortgage and not vice versa!

Wiremu Patrick
Mortgage and Insurance Advisory
Authorised Financial Advisor

Online Mortgage Brokers

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