12 Apr 2017

How to Minimise Interest on Your Home Loan

Minimise Interest on Your Home Loan

The final price you wind up paying on a property is hugely impacted by the interest rate of your home loan. Interest rates are a deciding factor in determining ideal loans, times to refinance and more – even a small reduction can save you thousands of dollars.

Interest rates are subject to change based on the economic climate and a host of other factors. The most influential factor is Australia’s cash rate, monitored by the Reserve Bank of Australia (RBA).

The state of Australia’s cash rate can have effects on the interest rates lenders charge, which means it affects the size of your repayments. Fluctuations in the cash rate also mean that lenders will fluctuate their interest rates in response.

But your interest rate isn’t entirely out of your control. There are myriad of options for homeowners looking to buy property and minimise interest paid. Here are a few of the more common ones:

Offset accounts

Offset accounts are essentially bank accounts which are linked to your mortgage. You can use an offset account like any other bank account.

But the benefit of having an offset account is that the more you have in it, the less you need to pay towards your mortgage. This means that the savings you keep in your offset account are always working for you, while remaining easily accessible in case of emergency or other unforeseen circumstances.

Mortgage House offer a range of offset account options that could potentially save you thousands.

Extra payments

If you make extra repayments towards your home loan, you can pay your debt off faster and pay less interest.

This option may not apply for fixed rate home loans, and not all lenders allow for it. If you’re able to make extra payments though, it’s almost always the best option because a higher percentage of the money you’re spending goes towards your property rather than the interest rate.


Of course, the most obvious solution is to refinance to a home loan that charges less interest.

Refinancing doesn’t have to be complicated. In fact, it’s probably quite a bit simpler than you think. If you’d like to discuss refinancing, contact Mortgage House today to investigate your options. You never know, you might wind up saving thousands with a simple phone call.

Mortgage House

At Mortgage House, we’re no strangers to the homeowner’s journey. It’s a long (but rewarding) one.

But don’t worry, we can help with that.

If you’re thinking of buying a home, you can contact us for advice about the best options for you when it comes to your mortgage. The cost of your mortgage can drastically affect your financial planning, so it pays to speak to the experts about it.

Click here to speak to us!

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