Helping you succeed in life's financial journey

How to pay off the mortgage faster

19 January 2016

Written by:

Steve Davies - Mortgage Adviser

With the official cash rate as low as it is, New Zealanders are presented with some of the best conditions for paying off the mortgage faster.

Dollar sign home loan - Mortgage Advice Hawkes Bay Hastings Napier

If you’ve ever wondered how to achieve this, here’s your chance to get started.

Just think of the doors this could open up for you – perhaps it is heading into retirement mortgage-free, retiring early, or allowing you to build more equity in your home that could enable you to get into a new business or build a rental property portfolio. Or more simply, it could just save you thousands (often tens of thousands) in interest over the course of your loan.

While every case is different (and decisions should be made with sound professional advice), let's outline some of the things to be considered when trying to take chunks off the mortgage.

There are three key steps in this exercise:

  1. First you need to decide why you want to reduce the mortgage term – what is your end goal? Is it to be mortgage free in a certain period of time? To move up the property ladder, perhaps into a bigger home? To buy a rental property? This will greatly determine which path is right for you. Believe it or not, there may be advantages in not paying off the mortgage faster!
  2. Take a good look at your budget. Know your cost of living and how much you are spending. Also, know yourself and how financially disciplined you are prepared to be. What are you realistically prepared to sacrifice? Only then can you make decisions on the best course of action.
  3. Get professional advice from a good Mortgage Adviser, which includes making a plan. Once you have a solid plan you can trust in it, and that shreds a lot of stress!

So, once you’ve decided you definitely want to start taking some big chunks off your debt, you can start thinking about how to go about it.

Other than coming into a windfall (lotto, anyone?!), here are the main ways to pay off the mortgage faster:


If you’ve given this some thought and are ready to take action, doing some quick calculations and having a chat with one of our professional Mortgage Advisers is a good start.

Whatever you do, be sure you don’t put yourself under too much pressure – if you’re not in the position to make higher payments, sometimes keeping the status quo is the best thing to do – and our Mortgage Advisers will give you honest advice if that’s the case.

Ask a Mortgage Adviser

It's a service that comes at no cost to you*, and puts your interests first - learn more here.

You might also be interested in these articles:

What is a financial plan? (and how it can help you do things!)

Six things to know about KiwiSaver

*Our standard Mortgage Advisory service is provided free of charge as we are remunerated (paid) by the banks, but we also provide specialised services and advice for non-conforming, credit-impaired, business and complex cases. After our free initial no-obligation consultation, we will advise you if a fee may need to be charged before we undertake any work. In many cases we may find a simple solution for you.

A disclosure statement is available, on request and free of charge.

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