4 Realistic Ways you Could Pay your Mortgage Off Faster

Posted by David Reed

The idea of paying off your mortgage in full probably seems fairly far-fetched, and unless you happen to win the lottery or have a wealthy relative die, it probably is. However, there are some realistic ways that you can shave years or even decades off the payment term, increasing your equity and saving you a heap of money in interest payments.

  • Refinance with a shorter term mortgage

Got a 30-year mortgage? Refinancing it as a 15-year loan will not only mean that you pay your mortgage off a whole lot faster, but since shorter-term mortgages often carry lower interest rates, you’ll probably also end up saving a fair amount of cash. Additionally, thanks to the shorter time frame, you’ll pay a lot less in interest over the duration of the mortgage.

  • Overpay

Most mortgages allow you to ‘overpay’ by a certain amount each year without facing a penalty, even if you are locked into a fixed rate deal. Generally, that’s about 10% of your mortgage balance. If you pay more than that, then you may have to stump up an Early Repayment Charge, so it’s best to contact your lender and enquire.

Increasing the amount of your monthly mortgage direct debit – even just slightly – will shorten your mortgage term and reduce the total amount of interest you pay.

  • Through lump sums of ‘found’ cash at the mortgage

Instead of (or as well as) paying a little extra each month, pour in any financial windfalls you run into, be it a work bonus, inheritance, return on past investments (etc). Doing so will have a similar effect to regular overpayments in regard to reducing the total amount of interest you pay.

Bear in mind, however, that in order to do this without penalty, you’ll need a fully flexible mortgage. This is because you could end up overpaying by more than 10% of your outstanding balance in a year.

  • Switch to a better deal

If you’re strapped for cash and can’t afford to pay your mortgage off quicker by overpaying, you may still be in luck! When you reach the end of your current deal, such as a fix, discount or tracker, you should shop around to ensure you are getting the best possible interest rate.

Just be aware that many of the lowest mortgage rates that you see advertised come with the highest set-up fees, so remember to factor these in when doing your calculations.


Even though you’re already a homeowner, your credit score will still be considered when you apply for a new mortgage so it’s wise to keep yours in check and take steps to improve it if necessary. To find out more about improving your credit rating, read our blog post here.

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