While loans offer quick access to money, repaying them can be challenging. For many, debts feel like an unshakeable monkey on their backs. Additionally, if one fails to repay loan installments per the agreed schedule between them and their lender, the interest and penalties keep spiraling upward. To avoid this and other similarly nasty outcomes, repaying loans quickly and early is incredibly necessary. Here are some ways to achieve quick and easy repayment of loans:
Making bi-weekly payments
Usually, loan installment schedules are geared toward monthly repayments. However, one can speed up this process and simplify it by making the payments bi-weekly. All one needs to do is submit a half-payment of each weekly installment. This approach has multiple benefits. Firstly, as the payments are carried out more frequently, the interest rates do not accrue and grow with time. Additionally, breaking down the installment amounts make them smaller and easier to pay off. Additionally, by making about 26 half-payments annually, one shortens the life of their loan by a few months or even years. For example, using this approach on a 30-year mortgage can reduce its span to about 26 years.
Refinancing personal loans
Refinancing is the process where people can change the interest rate or terms of their current mortgage. It is a valuable way to reduce one’s debt by lowering the interest rate as per the existing percentages offered by a given bank. Banks’ loan rates keep fluctuating, so changing that can be beneficial for one’s quest to repay their loans quickly. However, if there is a catch, banks may have a long list of terms and conditions for refinancing, so loan takers will have to take that into perspective.
Adding a secondary stream of income
One can take up side hustles like blogging, becoming a virtual assistant, or offering babysitting services to add an income stream to their life. This allows people to have the requisite money to make loan repayments on time and never default on any kind of installment payments at all. Adding an income stream apart from one’s primary job is a useful way to stabilize their economic condition and achieve a degree of immunity to the external financial climate, even if a recession is underway.