At Gateway, we understand financial freedom and wellbeing is a goal shared by many. One way you could achieve this is by paying your home loan off sooner. Below are some tips for paying your home loan off sooner.

Loan repayments
Increased frequency

Traditionally home loans have a monthly repayment frequency but changing your repayments to a fortnightly or weekly schedule can help you make an extra month’s worth of repayments each year.


If your monthly repayments are $3,000 you’d be repaying $36,000 a year. 

Fortnightly or weekly

Instead, if you made 26 fortnightly repayments of $1,500 or 52 weekly repayments of $750, you would be repaying $39,000 a year. This is one way you could pay your home loan off sooner. While this difference may not seem much, increasing the frequency of your loan repayments can reduce the life of your loan by years and save you thousands in interest. This is because each extra payment reduces your loan balance earlier and therefore the amount of interest.

Increasing your repayment amounts

When possible, paying off more than your minimum monthly repayment all adds up. Over the life of your loan interest rates will go up and down. When interest rates reduce it is likely that your minimum monthly repayments will reduce too. If you maintain your original repayment amount you’ll be paying off your loan faster than scheduled.

Our handy Extra Repayment Calculator can help you understand the impact extra contributions make to your loan. Enter the loan amount, payment frequency, interest rate, and extra contributions to see the time and interest saved over the life of your loan. 


What if I want the option to access my money?

If you are anticipating a future cost like purchasing a car, renovations, or if you are worried you may need to access money whilst paying off your mortgage, an Offset account or Home Loan Redraw could be suitable for you.

Offset account

If you are looking to reduce the interest you are paying on your home loan, an offset account could help minimise your interest repayments – as well as potentially shortening the overall term of the loan. When you take out a variable interest rate home loan, a transactional account is created and linked to your loan. This account becomes your offset account and doubles as your everyday transaction account, where you have the flexibility to access your money whenever you need it. The benefit of this linked transactional account is that any balance in your offset account is – as the name suggests – offset against an equivalent portion of your home loan balance. As a result, any interest on the loan account will then be calculated and charged on the remaining loan balance.

Which Gateway Home Loans can you link an Offset account to?
Learn more


Increased repayments and Home Loan Redraw

Home loan redraw facilities allow borrowers to withdraw the additional funds they put into their variable rate home loan. That is, any payments you put towards your home loan above the minimum required amount. Not only do you get the benefit of saving interest off your home loan, and therefore paying it off faster, but you have the flexibility of withdrawing the funds when you need them. The funds aren’t as readily available as in an everyday savings account so it’s ideal if you’re saving up for something like a holiday, new car, renovations, or an annual cost like school fees. Or, you could even reinvest the money elsewhere when you're ready, such as in another property.

To learn more read our article Tips to Lower Your Mortgage: Redraw Facilities

Which Gateway Home Loans can you link a Redraw facility too?

Please refer to the Terms and Conditions on the relevant product pages listed above for information.

How is Offset different to Redraw?

Both Offset and Redraw help reduce the amount of interest you pay on your home loan and enable you to pay off your home loan faster. However, if you’re looking for flexibility and the ability to transact and access your money quickly and easily when you need it, an Offset account could be a better option for you.

Redraw, on the other hand, may be the better option when you have a larger sum to pay down your home loan which you may only need to access in case of an emergency.

Important Note:

This article is for general information only. It does not take into consideration the individual needs or financial situation of any reader and must not be relied upon as financial advice. Should you wish to make a decision based on this information, you should seek independent financial advice.