Focusing Your Finances
Monday December 15, 2008
If you have decided to pay your mortgage company back as quickly as possible, then it is possible to benefit from focusing your finances on repayment alone. Quick use of mortgage calculators can demonstrate that the more money you keep in your mortgage for longer, the less interest you will be charged overall. This can make credit cards particularly useful for avoiding interest on your mortgage.
By taking out a mortgage with a low cost redraw facility or offset account it is possible to use a credit card with interest free days on purchases to try to reduce the amount of interest paid on a mortgage. This is accomplished by making normal purchases with a credit card only, while putting all available pay into the mortgage. Before the interest free days expire on the purchases, payment for the credit card is redrawn from the mortgage or money in an offset account is used to pay off the credit card in full. As interest needs to be avoided on the credit card completely, it is possible to benefit the most from a card with a reward program or one that offers cash back.
Essentially, as long as you can stop yourself from overspending on your credit card, it is possible to greatly reduce the interest you are charged through appropriate use of your credit card. This may not suit all mortgage types, though, so be sure to consult a professional financial advisor to discuss possible strategies to improve your specific financial situation.
Please visit our comparison page if you would like to compare home loans and mortgages or browse our site for mortgage company profiles if you want to read about a specific mortgage company.
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