3 ways to help keep your mortgage off your mind. 

There’s no feeling quite like that payday feeling.  But after a second, reality (and life admin) catches up with you. You sit down to deal with the essentials… and watch as your mortgage disposes of your disposable income.
 
At Bankwest, we believe that your mortgage shouldn’t mess with your bank account like that – so we’ve put together three tips to help put it back in its place.

1. It’s all about give and take

You’ve probably heard the phrase ‘redraw facility’, which sounds like some kind of training base for architects. But it’s actually banking jargon for permission to pay extra money off your mortgage, and the option to take the money back out if you need it.

So if you make $5,000 worth of extra repayments, you could redraw that $5K for a spur-of-the-moment holiday, or an expense you didn’t see coming. And by paying off extra, you’ve been charged less interest on your home loan and might have saved money up until that point. With some Bankwest home loans, you can even access your redraw facility for free through online banking – just keep in mind that redraw fees apply to other methods of redraw such as over the counter. 

2. Start losing interest

Unlike losing interest in season 4 of your favourite show, losing interest in your mortgage is actually a good thing. Interest is really just dead money, and an offset account can help you to reduce the interest you pay on your home loan.

An offset account works like a normal transaction account, but it’s linked to your home loan. Money that you have in there is ‘offset’ against the balance in your home loan account. Banks calculate the interest on your home loan daily, so your offset account balance can reduce that daily calculated interest.

3. Remember to rate your rate

When you make the same mortgage payment again and again for years, it’s easy to get complacent. These days, many homeowners don’t actually know what their interest rate is.

If you can’t remember your interest rate (or it’s changed during your loan term) you can check it by logging into online banking, or asking for an account position statement at your branch.

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Things you should know

The information contained in this article is of a general nature and is not intended to be nor should it be considered as professional advice. You should not act on the basis of anything contained in this article without first obtaining specific professional advice. To the extent permitted by law, Bankwest, a division of Commonwealth Bank of Australia ABN 48123123124 AFSL / Australian credit licence 234945, its related bodies corporate, employees and contractors accepts no liability or responsibility to any persons for any loss which may be incurred or suffered as a result of acting on or refraining from acting as a result of anything contained in this article.