How to save on home loan
interest in 2022

We’ve come up with 7 tips to help you save money and own your home sooner

21 January 2022|4 minute read

home loan savings in piggy bank next to shoes

Home loans are expensive, but there are always ways to save on interest and be more savvy about your home loan.

Here are 7 helpful tips to help you save on home loan interest. Plus, you might find yourself paying off your mortgage faster so that you can be debt-free sooner.

1. Switch to fortnightly repayments

By making home loan repayments fortnightly, instead of monthly, you’ll end up making an extra month’s worth of repayments each year.

This is an easy, low-impact way to pay off your home loan a little faster without your bank account taking a noticeable hit.

Because you’re paying off your mortgage faster, you’ll end up spending less on interest over the life of your loan. It may seem like a small thing to do, but every dollar saved adds up over time.

2. Make extra home loan repayments in 2022

Do you have some extra funds lying around with no intended purpose? Maybe you got a work bonus, a tax refund, or inheritance from a relative?

Whatever the case, consider putting these spare funds towards your home loan. By making extra repayments now, you could end up saving thousands of dollars in interest.

Don’t forget to be smart about what you do with your money. Before making additional repayments, check that you have a healthy emergency fund and enough money to cover bills, daily expenses and unexpected costs.

Also check whether you are able to make extra repayments without penalty. If you have a fixed rate home loan, your lender may limit or completely forbid making extra repayments.

Most borrowers with a variable rate mortgage will be able to make unlimited additional repayments, but it’s still worth asking your lender if there are any fees involved.

If you’d like to know how much you could save on home loan interest by making extra repayments, try out Aussie’s extra repayments calculator now.

3. Refinance with the help of a mortgage broker

Even if you’re happy with your current home loan, it may be beneficial to regularly review your loan and consider giving it a refresh.

Here are some reasons why you might consider refinancing your home loan:

  • To get a lower interest rate

  • To switch lenders

  • To consolidate debt

  • Because your needs and circumstances have changed since you first got your loan

  • To switch between a fixed and variable interest rate

  • To access equity

  • Because you can afford to increase your repayment amount.

Since refinancing can be complicated, it might be worthwhile consulting with a mortgage broker. They’ll do the hard work to ensure your refinancing experience is as stress-free as possible.

If you’d like to learn more about your refinancing options, get in touch with your local Aussie Broker today.

4. Make sure you aren’t overpaying on your home loan

While you can’t get rid of your home loan repayments until you’ve paid off your mortgage, there may be ways to reduce home loan expenses.

Keep an eye on the market to make sure your interest rate is competitive when compared to other rates on offer. If your lender is offering a lower interest rate to new customers, call them up and ask them to pass this rate on to you.

If you’re noticing that other lenders are offering better rates, don’t be afraid to switch.

While you should try to weigh up the costs of refinancing with your potential savings, even a marginally lower rate can save you thousands of dollars in the long run. Check to see how much a lower interest rate could save you by using our Mortgage Repayments Calculator.

With many lenders offering zero-fee or low-fee home loan packages, it’s also smart to check what fees you are paying.

Make sure you aren’t paying for any features that you aren’t using, like an offset account for example.

5. Make the most of your savings with an offset account

The key to saving money on your home loan is finding ways to pay less interest. With an offset account, this could be possible.

An offset account functions like a transactional savings account connected to your home loan. You put your savings in this account, and these funds offset your loan balance to reduce how much interest you are charged.

For example, say you have a $500,000 home but you have $50,000 of savings in your offset account. In this case, you’ll only be charged interest on the first $450,000 of your home loan, since your savings offset the remaining amount.

If you want to pay off your loan faster, you could consider putting these savings towards extra repayments.

6. Consider locking in a fixed interest rate for 2022

It’s likely that interest rates will continue to gradually rise in 2022, so it’s smart to start planning.

With many lenders offering competitive fixed rate loans, it may be time to consider locking in a low rate for the next 1 to 5 years.

Doing this will mean that your home loan is protected against any interest rate hikes for the remainder of your fixed term.

Not sure if a fixed rate is right for you? Speak to an Aussie Broker to learn more.

7. Increase your repayment amount

While you’ll spend more money in the short term by increasing your minimum repayment amount, you’ll save more on interest in the long run.

You might find that if you closely review your finances, there are ways to save so that you can afford to up your repayments. Perhaps you can negotiate a lower internet cost with your provider, or cut back on streaming service subscriptions.

It’s also possible that your income has increased since you first secured your loan. Maybe you got a pay rise, or your children have moved out.

If you can handle increased repayments, you can save on interest and get closer to owning your home outright sooner.

But be careful not to bite off more than you can chew! Make sure that you can comfortably afford increased repayments and your current lifestyle.


Your local Aussie Broker can help you navigate the home loan process smoothly. Book an appointment today to find out more about your refinancing options.

Book a chat with an Aussie Broker

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