So today I offered myself up as an expert and invited you to join me for a (virtual) coffee at the very lovely Lewers Bequest cafe in Emu Plains.

Sitting out in the sunshine on lovely wooden tables and chairs… but I digress…

Two questions came out of this – the first:

“How can I get out of making mortgage repayments but still keep my house.”

The facetious answer is to win lotto, but as Dr Karl says “Your odds (of winning lotto) are only slightly improved if you buy a ticket”, so it’s really not reliable and other than an inheritance or a significant other windfall we had better look for some more “real” solutions.

A real solution is to buy and hold an investment property and when the equity in the property is sufficient sell it off and pay out your home.  Think this won’t happen? Ask your parents what they paid for their first home and what it would be worth now. It’s not overnight (well it might be if you choose well) but it does happen and this sure beats working hard for each and every dollar of a $300,000 loan – plus interest.

The good news is buying an investment property is often much more affordable than you think, remember the  tenant and the tax man are helping you pay for that one, as opposed your own home where you are fronting all of the bill. I take a look at that over here. If the budget is very tight right now its not completely silly to look at covering the interest only on both places as a minimum if the bigger goal is to get the equity from your investment. We’re happy to look at this strategy for you in terms of the bigger picture.

I wouldn’t necessarily advise buying just any property, there are some simple rules for outperforming the market, but most of it comes down to timing. Buy right, hold and sell right, and get good advice at each stage. A buyers agent is invaluable as is some advice regarding the setup and the loan structure for buying and investment property designed to help you pay your loan off fast.

Other tips to minimise the amount of interest you pay (and therefore pay back less, which is *almost* the same thing)

• Pay even a small amount extra with every repayment
• Use an offset account effecitvely
• Pay weekly or fortnightly
• Direct all of your overtime right into the loan instead of “planning to” move it over (and kind of never getting there).

Happy to chat to you personally about these strategies – just ask!

How to avoid paying off your home loan (but keep the house)