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Everyone wants a home loan with a great low rate. However, it’s important to know that a sharp low rate is not everything.

At Easy Street, we wish to make having a home loan as simple and short lived as possible. Below are our helpful hints to pay off your loan faster by ensuring that you are using all your loans features and achieve financial freedom.

Don’t stretch yourself

This is an important one – only borrow what you can afford.  Easier said than done, but before you commit to a loan, it’s good to work out your fixed costs so your repayments don’t impact on your lifestyle. General living expenses such as groceries and petrol should be factored in, also don’t forget things such as school fees, car loans, credit cards and entertainment.

Once you have worked out your expenses, set yourself a budget to understand just how much you can repay. This will ensure you have enough money to not only stay on top of your repayments, but to ensure that you won’t be eating cheese on toast for the life time of your loan.

Make payments as often as you can

Being able to make payments fortnightly or weekly instead of monthly is a simple and cost effective way of reducing the balance on your loan.

If you’re making monthly payments of $2,000, yearly you’d be paying off $24,000. If you calculate repayments fortnightly at $1,000, you’d be paying off $26,000 per year. This is because there are 26 fortnight in a year, meaning you are making 1 extra payment each year. This may not seem like much short term but over a loan term, typically 25 years, this can save you thousands.

Use your 100% offset account

If you home loan offers an offset account – then you need to be using it. The term ‘offset account’ and how it works is not always well understood so it can often get overlooked when comparing home loans. However, using a 100% offset account could save you thousands in interest and essentially helping you pay your loan off sooner.

Unlike a redraw facility, a 100% offset account works just like a normal account except it is attached to your home loan. You can get your wage deposited straight into the account, and take money out as you need it.

Take a look Easy Street’s simple infographic on offset accounts to see how you could get on to Easy Street sooner.

How does an offset account work?

Put simply, the balance in your offset account is used to offset the amount owing on your home loan. For example: If you have a home loan of $500,000 with $50,000 in an offset account, you will only be charged interest on the remaining $450,000.

Get on Easy Street today

At Easy Street, we like to try and offer more. Generally offset accounts are only attached to variable home loans. With Easy Street we offer a 100% offset facility on both our variable and fixed rate home loans. If you’d like to take advantage of a great value home loan that offers a 100% offset account, visit www.easystreet.com.au.

All lending subject to lending guidelines. Terms and conditions, fees and charges apply – details available on application.

This information is general advice only and does not take into account your objectives, financial situation or needs (your “personal circumstances”). Before deciding whether to buy any product you should consider your personal circumstances. You should read and consider the Terms and Conditions when deciding to use any product (terms and conditions, fees and charges may apply). Our product Conditions of Use are available on our website.

Easy Street Financial Services is a division of Community First Credit Union Limited ABN 80 087 649 938 | AFSL and Australian credit licence 231204 | BSB No 512 170