Key Takeaways
Minimum repayments take roughly 30 years monthly or 28 years fortnightly. The real goal worth chasing is 10 to 15 years.
• How the loan is set up usually matters as much as the headline rate.
• Offset accounts work at any balance - the trick is making it your main account, not waiting until you’ve got tens of thousands in there.
• As your savings grow, parking excess in the loan itself adds useful friction - the maths is identical, but it’s harder to spend by accident.
• Fortnightly repayments are a tweak, not a strategy.
Most of the advice you’ll read about paying off your mortgage faster assumes you’ve got a lot of spare cash to throw at it. In reality, most of my clients don’t. They’ve got a mortgage, a couple of kids, the usual cost-of-living squeeze, and not a lot of room to suddenly start making double repayments.
The good news is that the strategies that actually move the dial don’t require a windfall. But they do need the right loan set-up and a few habits that quietly add up. With the RBA lifting the cash rate to 4.35 per cent in May - the third hike of 2026, clients are asking me about this more than they have in a while.
Here’s what I'd like you to take from this article; if you only ever make the minimum repayment on a 30-year loan, it’ll take you exactly 30 years to pay it off. Switching to fortnightly minimums shaves it down to roughly 28. That’s not bad, but it’s not what I’d call paying your mortgage off faster. The clients I work with are usually aiming to be done in 10 to 15 years. That’s the gap worth chasing, and the rest of this article is about how to close it.
Start with how the loan is set up, not the rate
Before you start tipping extra dollars at your loan, it’s worth asking whether the loan itself is helping you. A lot of borrowers focus only on the headline rate, when how the loan is configured often matters just as much.
If you’re on a variable loan, you can already make unlimited extra repayments - that’s standard. What varies is whether you’ve got an offset account, whether your loan is split between fixed and variable, and whether the term is still working in your favour. Fixed loans are a different story: most cap extra repayments at $10,000 to $20,000 a year and charge break fees if you go over. None of that shows up in a comparison rate.
The clients I see make real progress are usually on a variable or split loan with a 100 per cent offset, set up so their everyday cash flow is doing some of the work for them.
Use the offset account, even if your balance is small
An offset account is one of the most useful features available to an Australian borrower, and the good news is it doesn’t matter how much you’ve got in it. Every dollar that sits there reduces the loan balance you pay interest on, calculated daily. If your loan is $700,000 and you’ve got $5,000 in the offset, you’re paying interest on $695,000 today. Tomorrow if there’s $5,400 in there, you’re paying interest on $694,600. It’s quiet, but it’s working.
The idea isn’t to lock money away. It’s to make the offset your main everyday account so every dollar you earn is offsetting your loan from the moment it lands until the moment you spend it. Have your salary paid in there, run your everyday bills and groceries out of it, and let whatever’s left sit as long as possible before pay day rolls around again. Even an average balance of $5,000 to $10,000, used properly, saves real money over the life of a loan.
The clients who do this well aren’t tipping in extra cash - they’re just routing the money they already have through the right accounts.
A trick that helps as your savings grow
Once you’ve got a bit more money flowing through the offset, there is something you need to watch out for. When everything sits in one account, it all looks like spending money. The savings, the bills, the holiday fund, the buffer - it’s just one number, and the natural temptation is to dip in.
A simple fix is to use your loan account itself as the savings vault. Once your offset balance climbs past a level that feels comfortable - $5,000 or $10,000 for some people, more for others - you sweep the excess straight into the loan as an extra repayment. It’s still your money. You can redraw it back to your offset whenever you need it. But the practical step of having to deliberately move it back means its far less like to get chewed up or diminished by everyday spending.
The maths is identical to leaving it in the offset. Every dollar in either place reduces the interest you pay by the same amount. The difference is purely behavioural. Money in the offset is one tap away from a debit card; money parked in the loan needs a deliberate transfer. For a lot of people, that small extra step is the difference between savings that grow and savings that quietly evaporate.
Some clients prefer to use multiple offsets to overcome the issue and protect their savings - one for everyday, one for the holiday fund, one for Christmas, I even have one client who has an offset for the soccer World Cup! Most lenders will let you have multiple accounts, and they all offset dollar for dollar against your loan. The right approach is whichever one you’ll actually stick with.
Be careful with fortnightly repayments - they’re not the win most people think they are
Switching to fortnightly repayments is one of the most over-sold pieces of advice in mortgage land. People are told it’ll pay their loan off years earlier, switch to fortnightly, and then feel like they’ve sorted it.
Here’s the honest version. If you take your monthly repayment, halve it, and pay that every fortnight, you end up making 26 half-payments a year - which is the equivalent of 13 monthly payments instead of 12. That extra payment a year takes a 30-year loan down to about 28 years. It’s a small win, and it’s a free one if your lender calculates it properly, so go for it.
But if you’re only making minimum fortnightly repayments, you’re still on track to take nearly three decades to pay your mortgage off. They’re a useful tweak that should sit alongside everything else in this article, not a strategy in their own right.
One thing worth checking: some lenders quietly calculate fortnightly repayments by taking your annual repayment and dividing by 26, which gives you the same total as monthly with no extra benefit at all.
When rates eventually fall, keep your repayment level the same
We’re in a rising-rate environment right now, which makes this point feel a bit theoretical, but it matters. The RBA has lifted three times this year, and most economists expect rates to push higher before they ease.
But rates don’t stay in one direction forever. When they eventually drop - and they will, the smart move for borrowers serious about getting ahead is to keep your repayment level the same. Your minimum repayment amount may fall, but if you can afford to keep paying what you were paying, the difference goes straight off the principal. It’s one of the cleanest ways to accelerate loan repayments because you’ve already proven to yourself you can manage the higher number.
The same logic applies if you refinance to a sharper rate. If your repayment drops by $200 a month, you’ve got a choice: take the cash flow win, or keep the repayment where it was and shorten your loan by years. Both are valid. I just want clients to make that choice deliberately rather than letting it happen by default.
Don’t keep resetting the clock
Refinancing is often the right move - I do it for clients every week. A better rate, a better lender, a set-up that actually suits where someone is in their life. But there’s a quiet trap that comes with it: every refinance tends to reset the loan term back to 30 years.
If you took out your loan five years ago and refinanced to a fresh 30-year term, you’ve potentially just added another five years of interest. If you need the lower repayments offered by the new 30-year term, that can still be the right call - cash flow flexibility matters, but it should be a deliberate decision. Look to reduce the term of the new loan at the outset or plan a strategy to reduce the life of the new loan over time through extra repayments or use of the offset.
A smarter plan beats a harsher one
If you take one thing from all this, it’s that paying off a mortgage faster isn’t about gritting your teeth and going harder. It’s about getting the loan set up right, using the features you already have properly, and stacking a few quiet habits over the years to come.
If you’d like a fresh set of eyes on your loan and a clear sense of whether you’re on track for 28 years or 15, I’m happy to take a look. You can book a free, no-obligation chat with me through the Mondo Mortgages contact page and we’ll work through it together.
The sooner your money starts working harder than your interest bill, the better.
FAQs
Is it better to put money into the offset or make extra repayments?
Mathematically, the interest saving is the same. The difference is access. Money in your offset can be accessed or withdrawn at any time. Money paid as extra repayments is only accessible through the redraw feature. For a lot of clients I work with, the right answer is to use both - the offset for everyday cash flow, and the loan itself as a behavioural buffer once savings start to build.
How realistic is it to pay off a mortgage in 10 to 15 years?
It’s very realistic for clients with a properly set up loan, an offset account they actually use, and a habit of keeping repayments slightly above the minimum. It doesn’t require a huge income - it requires a plan. The borrowers who get there usually started with the right set-up and stuck with a few quiet habits.
Should I pay off my home loan or my investment loan first?
In most cases, owner-occupied debt comes first. Interest on your home loan isn’t tax-deductible, while interest on a properly structured investment loan generally is. Paying down the non-deductible debt first is usually the more tax-effective move, but it depends on your full position and is worth a proper conversation.
Want a fresh set of eyes on your loan?
Book a free, no-obligation chat with Sean and find out whether you’re on track for 28 years or 15.
