How to pay off your bond in 10 years

If you’ve just bought your first home, the day that your mortgage will be fully paid off and the property will really be yours probably seems a very, very long way off.
The good news, however, it that there are tried and tested ways to bring that day much closer – and save yourself tens of thousands of rands in the process, says Shaun Rademeyer, CEO of BetterBond, SA’s leading mortgage origination group.
“Did you know, for example, that if you have a home loan of R800 000 at an interest rate of 9,25%, you could drop your bond repayment period to 17 years instead of 20, and save R178 000 in interest, just by paying an extra R500 a month into your bond account?
“And if you were somehow able to make an additional payment of R2950 every month, you could slash the bond payoff period to 10 years just like that - and save R532 000 worth of interest.”
Unfortunately, though, most homeowners just don’t have that amount of extra income to hand every month, especially if they are first-time buyers, so they need to find other ways to chip away at their home loan balance and repayment period. Here are some expert alternative suggestions:
*Become a Scrooge. Start eliminating all unnecessary expenses, review your insurance premiums and put a limit on your cellphone usage.
*Increase your earnings.Take extra shifts at work, sell something at weekend markets, or look for some evening, holiday or freelance work to bring in extra income that you can put straight into your bond account.
*Rent out some space. Even if you don’t have a spare room to rent out, you can perhaps still make some extra cash to put towards your “bond liberation day” by renting out a storage space, garage or carport
*Make a lump-sum payment.If you receive an inheritance, tax refund, or bonus, apply it to the principal balance of your home loan. The interest savings are likely to be better than most other investments.

  Comment on this Article

  Please login to post comments

Post to my facebook wall
Characters remaining

    Latest Property News
    • 22 Nov 2017
      While sales have noticeably slowed in most sectors in most Cape town suburbs, the security estate sector in Constantiaberg has bucked the trend by remaining buoyant, with sales by August this year already surpassing total sales in 2016.
    • 22 Nov 2017
      The end of the year is fast approaching, and so are all the travellers, tourists and holidaymakers. For those who live near or own a property in a holiday-hotspot, the festive season also brings with it an abundance of short-term rental opportunities. Its a great way for property owners to make a few extra rand for their own holidays or to put towards their savings.
    • 21 Nov 2017
      The buying process is over, and the moving truck has delivered your household goods to your new property. Now it’s time to unpack and turn your new house into a home.
    • 21 Nov 2017
      When an offer to purchase a property is signed by both buyer and seller, this constitutes a binding agreement or “Deed of Sale” between the two parties. However, in most cases the “standard contract” might not be enough to cover all the specifics pertaining to the sale. The agreement may require some additions or alterations to clauses, which needs an expert hand in the drafting of such
    • 21 Nov 2017
      As more and more South Africans look to invest in property abroad, Spain is offering them one of the best deals in global real estate.
    • 20 Nov 2017
      Since 2012, sectional title complexes have been leading the South African property market, not only in terms of price growth, but sales volumes as well. Remaining relatively strong, even in the face of 2017’s political and economic turmoil, experts say this market segment could offer valuable insight into South Africans’ property purchase priorities.
    • 20 Nov 2017
      Regardless of whether you are purchasing your first start-up home, downsizing or moving in with roommates, finding ways to maximise small spaces can be a big advantage, says Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa.
    • 20 Nov 2017
      Property valued at approximately R1 billion is on High Street Auctions’ sales floor during the month of November, including the much-anticipated sale of the Tshwane Mayoral Residence and the land occupied by one of South Africa’s oldest operating gold mines.
    Subscribe to the MyProperty Newsletter

    Last Name  
    Email Address  
    Email Frequency
    Share this Page

    For Sale Property
    Rental Property
    More Options
    Connect with us