Feb 28, 2017 7:38:03 AM

Strategies for taking control of your mortgage

Topics: Rural & Lifestyle Properties, Finance, Mortgages, Review of Income and Expenses 0

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With house prices reaching record-high levels, the amount of debt that home owners are having to take on is quite staggering when compared to previous generations. If you’re fortunate enough to own your own home, you’ve likely already experienced some form of mortgage stress. Have a look at these simple strategies that will help you take control of your mortgage and relieve some of the mortgage stress you may be feeling.

Set smaller targets

When you consider your mortgage in its entirety, it’s easy to feel overwhelmed about the enormity of your loan. Paying back your mortgage can feel daunting, even insurmountable, quickly leading to financial stress. Instead of fretting over the total amount, try breaking your mortgage down into bite-sized chunks or targets that are more manageable and achievable. Work towards reaching these milestones by mapping out a realistic repayment plan. In this way, reaching a short-term goal will provide you with satisfaction and keep you motivated to stay on track.

 

Pay extra each week

By focusing on incremental successes, you can quickly take control of your mortgage. What we mean by that is simply this: paying a little bit extra into your mortgage each week, even as little as $5-$10 a week – the cost of a cup of coffee twice a week – can make a difference to your mortgage. It’s not a huge sacrifice but it could shave years off your interest repayments and ultimately help you to repay your loan much faster.

 

Lump sum repayments

A lump sum repayment can make a significant difference to your mortgage. If you’re lucky enough to receive a bonus or commission, or you’re expecting a tax refund, consider paying it into your mortgage. Depending on the type of mortgage you have, you may even be able to redraw your additional funds should you need them later.

 

Do a review of your income and expenses

It’s important you review your financial situation at least once a year. If your situation or lifestyle has recently changed – you have a new job or a family – then now’s 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. If you’re not already using an offset account and credit card to manage your monthly cash flow, you may want to consider this effective way of reducing the interest on your mortgage.

Taking control of your mortgage not only saves you money in the long run, it also goes some way to relieving some of the mortgage stress you may be experiencing.

 

Need help taking control of your mortgage?

We’d like to help you plan your repayment strategy so that you can get debt-free faster. Talk to a Mortgage Express adviser about taking control of your mortgage and reducing your mortgage stress with an income and expense review of your situation.


Disclaimer:

While all care has been taken in the preparation of this publication, no warranty is given as to the accuracy of the information and no responsibility is taken by Mortgage Express Limited for any errors or omissions. This publication does not constitute personalised financial advice. It may not be relevant to individual circumstances. Nothing in this publication is, or should be taken as, an offer, invitation, or recommendation to buy, sell, or retain any investment in or make any deposit with any person. You should seek professional advice before taking any action in relation to the matters dealt within this publication.

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