19 Aug 2025 12 Proven Tips for How to Pay Off Mortgage Faster

Let’s face it. Owning a home in Australia, especially in cities like Melbourne, can be expensive. Between interest rates, monthly repayments, and a never-ending loan term, it can sometimes feel like you’re working just to pay off the bank. 

But here’s the good news: there are smart, proven ways to pay off your home loan faster and save thousands in interest paid.

Paying off your mortgage early doesn’t just reduce debt; it gives you peace of mind, increases your financial flexibility, and opens doors to investment opportunities. Whether your goal is mortgage freedom, retiring early, or simply going on that long-awaited overseas holiday, the tips below will help get you there.

Here’s our no-nonsense guide to help you crush that mortgage sooner rather than later.

Custom Loan Structures to Help You Pay Off Your Mortgage Faster. Every borrower’s journey is unique. EverLend’s mortgage brokers tailor loan strategies to your financial goals, helping you pay off your mortgage faster without sacrificing comfort or flexibility. Call us today for a free consultation at 03 7036 3356. 

 

1. Make Extra Repayments

Every extra dollar counts when it comes to mortgage loan repayments. Even a small weekly top-up to your principal loan amount can shave years off your loan term and save thousands in interest payable.

• Got a variable-rate home loan? Most lenders allow unlimited extra repayments.

• Choose weekly or fortnightly repayments instead of monthly. You’ll sneak in one extra payment each year, without noticing much difference in your budget.

Example:

If you repay $50 extra each week on a $500,000 home loan, you could save over $30,000 in interest charged and cut 3–4 years off your mortgage repayment period.

 

2. Use an Offset Account

An offset account is like a magic trick for your mortgage. It’s a bank account linked to your home loan, and any money sitting in it reduces the amount of interest charged on your loan.

So, if your loan balance is $400,000 and your offset balance is $20,000, you’ll only be charged mortgage interest on $380,000.

• Great for emergency savings.

• Helps maintain cash flow while reducing interest payable.

• Avoids relying on a redraw facility (more on that later).

3. Increase Home Loan Repayment Frequency

Switching from monthly to fortnightly home loan repayments doesn’t just align better with your pay cycle. It actually results in more repayments over the year.

There are 12 months but 26 fortnights in a year. If you’re currently paying $1,500 monthly, consider switching to $750 fortnightly. That’s one extra mortgage payment per year.

This accelerates your repayment cycle, reducing both principal and interest faster.

 

4. Put Lump Sums Toward Your Loan

Got a tax refund? Bonus? Side hustle income? Toss it straight at your mortgage repayment as a lump sum payment.

• These lump sums go straight to the principal, cutting down both the loan balance and total interest payable.

• Don’t spend your superannuation fund or sell asset classes, but think about cutting back on a big splurge and redirecting the money.

Tip: Try our mortgage payoff calculator to see how even a $2,000 lump sum can save you thousands.

 

5. Refinance to a Lower Interest Rate

If you haven’t checked your interest rate in the last year, chances are you’re paying too much.

• Use comparison websites or speak to a trusted Melbourne mortgage broker.

• Negotiate with your mortgage company, especially if you’ve been a loyal customer.

• Look at break fees, especially if you’re on a fixed-rate loan.

Even a 0.5% drop in your interest rate can save tens of thousands.

 

6. Avoid Interest-Only Loans

They might look attractive, but interest-only loans just delay the inevitable. You’re paying only the interest charged, not reducing the principal loan amount.

• Avoid interest-only home loans unless it’s an investment property strategy.

• Focus on principal and interest repayments to make real progress.

 

Balance Flexibility & Stability for Faster Mortgage Settlement. Torn between a fixed interest rate and a variable rate? EverLend’s expert Melbourne mortgage brokers can guide you through smart split-rate home loan options, giving you the protection you need with the flexibility to make extra home loan repayments. For a free chat, call us today at 03 7036 3356. 

 

7. Use a Budget to Free Up Cash

Take a good, hard look at your spending.

• Track your bank account transactions.

• Identify unnecessary expenses (subscriptions, dining out, unused gym memberships).

• Redirect that money toward your mortgage repayments.

Cutting out the $50/week lifestyle creep can give you an extra $2,600 a year, straight into your offset account or loan.

 

8. Round Up Your Payments

This one’s a classic psychological trick. Round your monthly repayment up to the nearest hundred.

If your repayment is $1,436, make it $1,500. You won’t miss that extra $64, but over time, it reduces your loan term and saves on interest paid.

 

9. Set Mortgage Payoff Goals

Goals keep you focused. Break down your mortgage into chunks and celebrate small wins.

• Use a mortgage calculator or ASIC repayment calculator to set short-term milestones.

• Print your loan balance and stick it on the fridge.

• Track it every 6 months to see the progress.

Stay motivated by visualising the discharge of mortgage and what life will look like without it.

 

10. Avoid Redrawing Funds

Many loans offer a redraw facility, but try not to treat it like a bank account.

• Withdrawing your extra repayments resets your progress.

• Keep your mortgage separate from everyday expenses.

• Consider using an offset account instead of redrawing.

11. Consider a Shorter Loan Term

A 30-year loan term is the standard, but a 15 or 20-year option can be a game-changer.

• Yes, your monthly repayment will be higher.

• But the interest savings are huge, and you reach your home ownership goal faster.

Run the numbers using a repayment calculator or a refinance calculator.

 

12. Review Your Mortgage Regularly

Every 1–2 years, do a full mortgage health check.

• Are you on the best variable rate or fixed interest rate?

• Has your property value increased?

• Could you refinance or change your repayment cycle?

Check tools like ASIC MoneySmart or speak to trusted mortgage brokers, such as the team at EverLend.

 

Get Clarity and Pay Off Your Mortgage Faster. Refinancing or buying your first home? EverLend’s expert Melbourne mortgage brokers break down your borrowing power and loan options, so you can reduce your mortgage term and reach home ownership sooner. Book a free consultation with us today by calling 03 7036 3356. 

 

Frequently Asked Questions (FAQs)

How do I pay off a 30-year mortgage in 10 years?

You’ll need to make significantly higher extra repayments, increase repayment frequency, use an offset account, and avoid interest-only repayments. Creating a solid budget and using tools like a mortgage payoff calculator can help you stay on track.

How to pay off a $400,000 mortgage in 5 years?

It requires aggressive saving and consistent lump sum repayments, like using your tax refund, bonuses, or side income. Refinancing to a lower interest rate, cutting expenses, and using an offset account will also be key.

How to pay off a 30-year mortgage in 10 years Australia?

Follow a focused strategy: increase to fortnightly repayments, make extra repayments, refinance to a better interest rate, and use a mortgage offset account. Review your progress every year with tools like the ASIC repayment calculator.

What happens if you make 2 extra mortgage payments a year?

Making just two extra payments per year can cut your loan term by several years and save tens of thousands in interest payable, depending on your loan balance and interest rate. Use a repayments calculator to see your personalised savings.

How can paying off my mortgage faster help me invest in a Melbourne property?

By reducing your loan balance and achieving mortgage freedom sooner, you can free up cash flow for other investment opportunities, like buying property in one of Melbourne’s best investment suburbs. With lower debt, you’ll improve your loan-to-value ratio and be in a stronger position to expand your property investment portfolio.

How can I pay off my mortgage faster without refinancing?

Focus on extra repayments, using an offset account, and increasing your repayment cycle to fortnightly or weekly.

Is it better to put money in an offset account or make extra repayments?

Both help reduce interest charged, but an offset account keeps the funds accessible, ideal for emergencies or flexibility.

How often should I review my mortgage?

Every 1–2 years. Check for better interest rates, changing loan terms, or improved property value.

 

Wrapping Up

At the end of the day, the journey to pay off the mortgage faster is all about making smart, consistent choices that align with your financial goals. Whether it’s using an offset account, switching to fortnightly repayments, or cutting back on everyday spending, every bit counts. 

If you’re feeling unsure where to start, don’t stress. Chat with our trusted Melbourne mortgage broker at EverLend. They’ll help you explore options tailored to your situation, from refinancing to full home loan health checks. Call us today at 03 7036 3356 to book your free consultation.