Tips for Accelerating Your Mortgage Repayment

Tips for Accelerating Your Mortgage Repayment

Paying off a mortgage can often feel like an endless journey, but with the right strategies and discipline, homeowners can accelerate their mortgage repayment to save on interest and become debt-free sooner. Whether you’ve just signed on the dotted line of a mortgage agreement or you’re years into payment, there are actionable ways to fast-track your mortgage payoff without putting a strain on your financial health.

Understand Your Mortgage Terms

To begin, it’s crucial to have a firm grasp of your mortgage terms. Knowing the ins and outs of your interest rate, payment schedule, and the possibility of penalties for early repayment is essential. Many mortgages allow for extra payments, but some might carry prepayment penalties that could negate any interest savings. Ensure you’re clear on these terms before making additional payments.

Extra Payments: The Power of One More

One of the most straightforward ways to speed up your mortgage repayment is by making extra payments. Even one additional payment a year can make a notable difference. If your budget allows, consider bi-weekly payments instead of monthly. This results in one extra full payment each year, as you’ll make 26 half-payments (the equivalent of 13 full payments) over 12 months.

Lump-Sum Payment Windfalls

Another tactic is to make lump-sum payments whenever possible. Use unexpected windfalls such as tax refunds, bonuses, or inheritance money to put toward your mortgage principal. This can drastically reduce the amount of interest you'll pay over the life of your loan, as well as shorten the time it takes to pay off your mortgage.

Refinance to a Shorter-Term Loan

If interest rates have dropped since you took out your mortgage, refinancing to a lower rate can save you money and potentially allow you to switch to a shorter-term loan without a significant increase in your monthly payment. A 15-year mortgage will have higher payments than a 30-year term, but the total interest paid over the life of the loan is considerably less.

Budget Adjustments and Cutting Costs

Assessing your monthly budget provides another opportunity for accelerating your mortgage repayment. Look for areas where you can cut back on expenses and redirect that money toward your mortgage. Small sacrifices can lead to large savings over time.

Increase Your Income

In addition to cutting costs, consider finding ways to increase your income. Whether it’s asking for a raise, taking on freelance work, or starting a side hustle, extra income can be put directly toward your mortgage principal, shortening the overall term of your loan.

Round Up Your Payments

An effortless habit that can speed up your mortgage payoff is rounding up your payments. If your monthly payment is $1,470, consider rounding up to $1,500 or even $1,600. That extra amount goes straight to reducing your principal balance.

Avoid Lifestyle Inflation

As your career progresses and your income grows, resist the temptation to increase your spending in equal measure. Instead, maintain your lifestyle and allocate the additional income to your mortgage, this accelerates repayment without feeling the pinch.

Put Down a Larger Down Payment

Although this option is only applicable before buying a house, it's worth mentioning. The larger your down payment, the less interest you’ll pay over the life of your loan because your loan amount will be less. Aim for a down payment of at least 20% to avoid private mortgage insurance and to reduce your loan balance from the start.

Stay Informed and Review Regularly

The mortgage landscape can change, so stay informed about mortgage trends and new opportunities for saving on interest. Additionally, review your mortgage regularly to ensure that you’re still getting the best deal and that it aligns with your financial goals.


Accelerating your mortgage repayment is a commendable goal that requires a combination of strategy, discipline, and sometimes, creativity. From making extra payments and refinancing to increasing income and cutting costs, there are numerous approaches one can take to reduce the term of their mortgage. Remember, even small changes can have a huge impact over the life of your loan.

However, it is important to keep a healthy balance to ensure that striving for a mortgage-free life does not lead to undue stress or financial strain. Always assess your financial situation periodically and consult with finance professionals to ensure that the steps you are taking align with your overall financial plan.

By implementing these tips, homeowners can look forward to the day they make their last mortgage payment, knowing they've saved significant amounts of money in interest and can enjoy the financial freedom that comes with owning their home outright.

This article was contributed on Feb 08, 2024