Small structural changes to how you repay a mortgage can take years off it and save tens of thousands in interest. None of them are complicated — they just need to be set up deliberately.
Pay fortnightly, not monthly
Switch from 12 monthly repayments to 26 fortnightly ones and you effectively make an extra month's repayment a year — without really feeling it. More frequent payments also reduce the balance interest is calculated on.
Make extra repayments
Anything above the minimum comes straight off the principal, cutting both the balance and the interest. As an illustration, on a $500,000 loan at 4% over 30 years, an extra $100 a month can clear it around two years early and save tens of thousands in interest. (Illustrative only — your figures depend on your rate and balance.)
Use an offset account
An offset is a transaction account linked to your loan; its balance reduces the amount you're charged interest on. Keep $50,000 in offset against a $500,000 loan and you're charged interest as if you owed $450,000 — while the cash stays available for emergencies.
Refinance to a lower rate
If your rate is above market, refinancing can save meaningfully over the remaining term. Just weigh the switching costs (break, settlement and application fees) against the saving.
Stay on principal and interest
P&I repayments steadily shrink the balance, which lowers the interest, which lets more of each repayment hit the principal — a snowball that builds equity faster than interest-only.
The trade-offs
Paying a mortgage down fast isn't always the top priority. You might earn more by investing the surplus, some loans have prepayment penalties, and you shouldn't drain your emergency buffer to do it. Match the strategy to your wider plan.
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Book a Clarity Call — It's FreeCommon questions
What's the fastest way to pay off a mortgage?
A combination: switch to fortnightly repayments, add extra repayments to the principal, use an offset account, and make sure your rate is competitive. Together these can take years off the loan.
Does an offset account help pay off a mortgage faster?
Yes — the balance in an offset account reduces the loan amount you're charged interest on, so more of each repayment goes to principal, while the cash stays accessible.
Are there downsides to paying off your mortgage early?
Sometimes. You might earn more by investing the money, some loans charge prepayment penalties, and overpaying shouldn't come at the cost of your emergency savings.
This article is general information only and doesn't take your personal circumstances into account. It isn't financial, tax or investment advice. Tax rules and lender policies change — confirm your position with a licensed professional or the ATO before making decisions.
