Increasing payments cuts years off couple's mortgage

David Hamilton and Lyna Pen have pushed themselves to pay more than the minimum.

David Hamilton and his fiancee Lyna Pen are in their 20s but hope to be mortgage-free within 10 years.

The Auckland couple bought their first home two years ago in Te Atatu for $432,000 after scraping together a 10 per cent deposit.

They took a 30-year mortgage but have been chipping away at the principal ever since.

Mr Hamilton, 28, is an electrical company engineer and Miss Pen, 25, is a pharmacist.

The couple earn nearly $130,000 combined. With no children, they have been able to put money aside since buying their house and have made several $10,000 lump-sum payments against the principal.

They have also increased their weekly repayments by $50 over the minimum required, knocking 11 years off the life of their mortgage and saving about $180,000 in interest costs.

"We're still young, we don't have kids at the moment so we're taking the opportunity to pay a bit more off," Mr Hamilton said.

"We still go out for dinners but we try to make an effort and pay a little more and push ourselves."

Mr Hamilton said he was not too worried at the thought of signing up to 30 years of debt when the purchase went unconditional.

"You grow up, you get a mortgage, you slave away paying it off until you have enough money to retire. But by paying an extra $50 a week on the principal you drastically reduce the amount of years you're paying off your mortgage."

The couple hope to have children in the next few years and can revert to minimum payments if money gets tight, but would "ideally be mortgage-free in 10 years".