How to Pay Off a Home Loan Quickly

Homeowners with a 30-year mortgage may think they will never repay their home debt. Fortunately, a long-term home loan can be repaid quickly if you are in the financial position to do so. MSN Money reports that one couple, with a starting annual gross income of $55,000, was able to pay off a $150,000 mortgage in only five years. Some financial advisers recommend investing your money in CDs or other accounts, rather than paying off a mortgage quickly, so weigh the financial benefits of paying early before you make a decision.


Plan a thorough monthly budget. Determine how much money you will have left after accounting for all your monthly expenses, including living expenses, debt and recreation. Let's say you have $400 remaining.


Calculate how much to set aside for an additional mortgage payment once you have determined your monthly discretionary income. In our example, you might want to set $200 aside for an emergency spending account and $100 for savings. This means that you could pay an extra $100 toward your home loan.


Calculate how much this additional payment would save you in interest and to what extent it would shorten your loan. Use an online mortgage calculator to determine these amounts. In our example, assuming the home loan is for 30 years and totals $150,000 at 6.25 percent interest, a $100 additional monthly payment would result in interest savings of $48,596.60, and the loan would be paid off six years and nine months early.


Consult your mortgage lender to determine which method is best for early repayment, once you are sure that you can comfortably afford the additional payment. As noted at All Business, your lender may allow biweekly payments, lump-sum payments or a monthly payment increase.