Tips to pay off your home loan up to 10 years earlier. But is it a good idea?

1. Find extra cash

Cash in your emergency savings accounts and deposit those funds into your bond account. This will also give you tax benefits. Another way of raising extra cash to reduce your bond account is to sell unused furniture or appliances, such as that old tumble dryer or television set gathering dust in the garage. You could even rent out unused space on your property and deposit this rental income into your bond.

2. Pay extra into your bond

Consistently adding just R1 000 to your monthly bond payment can make a big difference.

"Let's say you buy a house for R2 million and put down a R500 000 deposit. So you have a R1.5m bond at an interest rate of 7%. That gives a monthly payment of R11 629 over 20 years.

"Now let's say you can afford to pay R1 000 more (R12 629) and maintain that every month. If interest rates stay the same, you could pay off your bond more than three years early, and save a significant amount in interest.

"If you upped that monthly amount by R2 500 - if you could afford to - you could pay off your bond in just over 13 years," says Dyer.

"The biggest problem with this approach, though, is that it requires willpower. To reap those benefits, you have to voluntarily put an extra R1 000 towards your bond payment every month."

3. Apply pay raises to your bond

One way to find extra cash to put toward your home loan is to deposit money you get from raises and bonuses.

"The goal is to put the same percentage of your income toward your bond, even when your pay goes up. In other words, if you're currently putting 15% of your income towards your bond payment, 15% of each annual raise amount should also go towards your bond, in addition to what you're already paying.

"If you're leading a comfortable lifestyle and can avoid lifestyle inflation that often follows a raise, you can put your entire raise amount towards your bond balance."

This strategy works best for those who get regular raises over and above minor cost-of-living adjustments, he says. "But, if you aren't expecting to see your income increase any time soon, this strategy might not be the best option to start with."

4. Use cash windfalls to pay lump sums

Instead of paying a little extra each month, you could pay a large lump sum here and there, suggests Dyer. "This can be done with a cash windfall, such as from an annual tax refund, 13th cheque or bonus, or inheritance."

So if you put R30 000 towards your home loan when you get your tax refund, all of your payments from there on out are a little more effective, because less of them are going towards interest.

5. Set a target pay-off date

"Setting a target pay-off date allows you to know exactly how much extra to pay each month to be bond-free by a certain date," says Dyer. And you'll have the extra motivation of marking your calendar to plan the celebration.

There's no need to select only one method from this list, says Dyer. "Many bondholders choose a few options and combine them to pay off their loans even earlier."

Goslett of RE/MAX offers this extra advice:

6. Rent out a portion of your property

If you have a potential flatlet on your property - or one that can be converted without too much expense - or you have room to spare, consider renting out this space to tenants. You can then deposit the generated income straight towards bond repayments.

7. Treat the loan as a savings account

Adding just a little extra money - ie, more than the required minimum monthly instalment - to your monthly bond payment can make a big difference.

By moving any excess money into the home loan account each month, you'll be decreasing the outstanding capital balance and reducing the loan term as a result.

If you have an access bond facility, you can treat your bond as a savings account by depositing any extra cash you might have into the loan account. You can then later access this capital through your home loan if an emergency arises, says Goslett.