In essence, reducing mortgage debts is enabled by increasing the amount and frequency of your repayments. Additionally, there may be ways to take advantage of  lower interest rates in order to reduce the total amount of debt that needs to be repaid.

Methods of Mortgage Debt Reduction

By increasing the frequency of your mortgage repayments, for example weekly or fortnightly instead of monthly, you will be reducing the average daily balance of your mortgage throughout the year even though the total amount of repayments is the same.

If you increase the amount of each repayment you make you will be reducing the principal of the loan as well as the interest associated with it. The longer you take to pay off a loan of any kind, the more you will end up paying in interest.

Mortgage refinancing is another way of reducing mortgage debts. To put it simply, this involves taking out a second mortgage at a lower rate of interest than the original mortgage. You can then use the money from the new loan to pay off the old one. You’ll still have to repay the new mortgage but there will be less interest to pay off.

A somewhat riskier method of juggling interest rates is to pay off the majority of your living expenses with a credit card. As long as you can afford to repay the credit card debt within the interest free period you can allocate your own funds to minimise the average daily amount of your mortgage.

These approaches will usually apply to reducing the non tax deductible debt on your home property but can also apply to investment properties.