5 Smart Tips On How to Repay Your Loan Quickly in 2022
5 SMART TIPS ON HOW TO REPAY YOUR LOAN QUICKLY IN 2022.
Bank Lending Rate in Kenya is expected to be 13.12 percent by the end of this quarter, according to Trading Economics global macro models and analysts expectations. In the long-term, the Kenya Bank Lending Rate is projected to trend around 13.12 percent in 2023. Having this information in mind, whether you owe money on a personal loan, car loan, or mortgage, the sooner you pay it off the less you’ll spend on interest. If you are looking for ways to repay your loan before the end of the loan term (even by the end of this year), here are some smart tips for speeding up your repayment plan.
- CUT A FEW EXPENSES IN YOUR BUDGET.
One way to get some extra cash to make that extra payment towards your loan is to cut a few costs from your budget. You could save a huge chunk of money by downsizing to a smaller space or moving into a less expensive neighborhood. This for sure can make you miserable and it may not be worth it, let’s look at smaller changes to your budget that you can implement. You can start saving up for that extra payment by making everyday savings for example instead of eating a takeaway meal at work, you can carry homemade food, end your gym membership and start home workouts, downgrade your Netflix subscription, etc. These are some of the small changes that can add up and pay extra cash for your loan without you uprooting your entire life.
- ROUND UP YOUR PAYMENTS.
Simple actions such as rounding up your payment for example if you owe KSH.35,000 a month then pay Ksh.40,000 can boost your loan repayment efforts. You need to plan your budget accordingly if you plan to make larger payments each month.
- BOOST YOUR INCOME AND PUT THE EXTRA MONEY TOWARDS THE LOAN
If you have extra time on your hands, you could pursue an additional job as another stream of income to help with your loan repayment. This move has the potential of putting you ahead of future loan costs. This would mean putting aside pride and getting to work as you may have spent years without doing a part-time hourly-waged job. The side hustle you choose should hinge on your skillset hence it will be easy for you to start working and earning almost immediately. You are not limited though, you can pick more than one side gig, just don’t spread yourself too thin in the process. In summary as your income rises, increase your loan repayments.
- PUT THE EXTRA CASH TOWARDS YOUR LOAN
When you come across some extra cash of money either through inheritance, tax refunds, salary bonus, etc., don’t spend it on wants no matter how tempting it may be. Resist the urge and forward that money towards loan payments. This will save you interest costs in the future and you can congratulate yourself on the wanted item that was tempting you.
- REFINANCE.
This is the best way to pay off your loan early. When interest rates have dropped since you took out your loan or your credit score has improved drastically, it is smart to seize the opportunity and consider refinancing as it can help you pay the loan sooner by shortening the loan life span. The lower interest rate will make it affordable for you. Contact Elevate Credit and ask about refinancing. We are committed to offering services quickly and efficiently, using a trustworthy and hassle-free process.
CONCLUSION.
Now that you know how to pay a loan off faster, you can use the above strategies and be debt-free soon. Paying off your loan within the stipulated tenure helps increase your credit score and increases your eligibility the next time you need a loan. However, make sure you have enough money in an emergency fund to cover any unexpected expenses before you start trying to pay off your loan faster. While it’s nice to get out of debt, you’ll still need to pay the bills if a crisis occurs.
