For any homeowners who are struggling to manage their debts, most financial experts agree that paying off your home loan faster is a great way to save on interest payments.
The chief executive of credit union Community CPS Australia, Kevin Benger, says if homeowners can pay the loan off faster, less interest is paid overall. Either change to fortnightly repayments or make payments off the principal from time to time if you have got spare cash.
Managing director at Club Financial Services, Andrew Clouston, says other higher-interest debt should be addressed first, then the mortgage can be tackled. He also urges anyone having financial problems to ask for help.
"A lot of banks now have help lines for people struggling, and a lot of brokers offer advice, too,’’ he says.
"Interest-free and no repayment financing sounds great, and it does work for some people, but there is a catch and many people have found themselves paying more money than what the goods are actually worth," he says.
NAB financial planning manager Judy Power suggests looking into debt consolidation whereby homeowners pay off personal debt such as credit cards or car loans on the mortgage rate, which will most likely be a lot less than the credit card interest rate.
All financial experts agree that reducing debt should be a priority while interest rates for home loans are so low.
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