7 tips to pay off your home loan sooner

Even an extra $100 a month in mortgage repayments could save you thousands of dollars and wipe years off your loan.

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Rebecca Pike

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Key takeaways

  • The most obvious way to pay off your home loan faster is to throw a little extra money at your mortgage each month.
  • But you can also use an offset account, refinance, shorten your loan term or change the frequency of your repayments.
  • Finding ways to repay your loan sooner will save you both time and money, getting you debt-free faster.

1. Increase your loan repayments

Most lenders let you increase your regular home loan repayments. You can often do this online or via your banking app, although you may need to call your lender to set up the new payments.

Even a small extra repayment each month can make a big difference to your overall loan costs.

Here's a simple example using Finder's extra repayment calculator.

Example

You borrow $600,000 over 30 years with a 5.00% interest rate.

Your monthly repayments are $3,221.

By the end of your 30-year term you'll have paid $559,353 in interest on top of your loan.

But if you increased your repayments by $100 a month you'd repay the loan in 28 years and pay $43,000 less in interest.

2. Switch from monthly to fortnightly repayments

This is a neat little trick. If you repay your home loan on a monthly schedule you make 12 repayments each year. But if you switch to a fortnightly frequency you make 26 half-sized repayments each year.

Fortnightly repayments essentially give you an extra monthly repayment each calendar year. This puts you slightly ahead. And over 30 years it makes a big difference.

Use our fortnightly repayment calculator to compare the overall cost of the loan if you paid monthly versus fortnightly.

3. Make a one-off extra repayment

Maybe you have some extra cash in savings lying around. Nice. But you don't want to increase your regular loan repayment.

Instead you could just make a one-off lump sum repayment. That way you could pay off a small extra chunk of your loan in one go.

You still pay off your loan sooner this way. And if your loan has a redraw facility you can even pull that money back out in an emergency.

Must read: Some home loans won't let you make extra repayments

Every variable rate home loan lets you make extra repayments. But this is not always the case with fixed rate loans. Some lenders limit the amount of extra money you put towards the loan. Once the fixed rate period ends and the loan moves to a variable rate you can make extra repayments.

4. Use an offset account

Does your home loan have an offset account? It's one of the best money (and time) saving mortgage features.

It's a bank account attached to your home loan. If you put your savings in there that money reduces your overall loan principal.

You make the same repayments, but your lender charges you a little less interest and takes off more of the loan principal. This means you pay off the home loan sooner and pay less interest.

5. Shorten your loan term

Most Australians go for a 30-year loan term. But you could reduce your loan term.

Here's how it works:

  • A longer loan term means smaller monthly repayments but you pay more interest over time.
  • A shorter loan term means bigger monthly repayments but you pay less interest and pay off the loan faster.

Here's how that looks in reality:

  • If you had a $600,000 loan with a 30-year term and a 5.0% rate your monthly repayments would be $3,221. By the end of the 30-year term you'd pay $559,535 in interest.
  • But if you had a $600,000 loan with a 25-year term and a 5.0% rate your monthly repayments would be $3,508. By the end of the 25-year term you'd pay $452,263 in interest.
  • That's $107,272 less.

6. Think about refinancing

Refinancing means switching from one home loan to another. Many borrowers do this for a very good reason: to get a lower interest rate.

Refinancing won't help you pay off your loan sooner by itself. But a lower interest rate means cheaper repayments. And you can use some of that extra money to pay your home loan off faster.

You can also change your loan term when you refinance to make it shorter.

Did you know?
Our latest State of Women's Wealth Report reveals a clear gender gap in home ownership. Gen Z men are twice as likely to own a home outright compared to Gen Z women (18% vs 9%), and millennial men are 50% more likely to have paid off their homes (15% vs 10%). Overall, 46% of women say they're behind in their journey to home ownership, compared to 33% of men.
Source: Finder's State of Women's Wealth Report 2025

7. Save money elsewhere

So you've thrown all the extra money you can at your home loan, you've got your savings in your offset account, you've refinanced to a better deal and you've switched to fortnightly repayments.

You're doing everything you can to repay your home loan sooner. What's left?

This is where you start to look at other ways to save money, and put the savings into your mortgage.

How to save more each month

  1. Review your spending. Take a look at where your money actually goes each month. The numbers don't lie. Just how much are you really spending on things you might not actually need?
  2. Draw up a budget. Once you have these spending figures you can decide where to cut back or set firm limits. You might decide you only need one streaming subscription instead of three. Or you decide that $300 on Uber Eats each month needs to become $150.
  3. Make a savings goal. Once you've found ways to cut back you should have a good idea of how much extra you can save each month. Make that a goal and see if you can stick to it. Let's say you find an extra $200 a month you can realistically save. Put it on your home loan each month.

Frequently asked questions

Sources

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Rebecca Pike is Finder’s money editor, with over 7 years of experience in mortgages and personal finance. A frequent TV and radio commentator, she frequently appears on Sunrise and 7News, Today and 9News, as well as Sky News, Channel 10 and across radio and print. Rebecca previously served as Editor of Mortgage Professional Australia. She has a Master’s degree in Journalism as well as ASIC-recognised certifications in Tier 1 Generic Knowledge and Tier 2 General Advice Deposit Products, which comply with ASIC guidelines. See full bio

Rebecca's expertise
Rebecca has written 253 Finder guides across topics including:
  • Home loans
  • Personal Loans
  • Car Loans
  • Cost of living
  • Budgeting
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