05 Feb Additional Mortgage Repayments
Quick example to show the benefits of making additional repayments to your mortgage.
Assuming a $500k P+I loan at 4.00% with a 30 year term and monthly payments the accumulated interest over the term is approx $360k.
If you repaid $10 extra per month, your accumulated interest over the term would be closer to $356k and your loan term would be reduced by 2 months.
If you repaid $100 extra per month, your accumulated interest would about $328k and your loan term would be reduced by 2 and a half years.
If you repaid $250 extra per month, your accumulated interest would be roughly $292k and your loan term would be reduced by 5 years.
The interest savings are exponential, the more you repay and the shorter the loan term will be meaning you will be debt free sooner.
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