It has been predicted and experimentally demonstrated that by injecting squeezed light into an optomechanical device it is possible to enhance the precision of a position measurement. Here, we present a fundamentally different approach where the squeezing is created directly inside the cavity by a nonlinear medium. Counterintuitively, the enhancement of the signal to noise ratio works by de-amplifying precisely the quadrature that is sensitive to the mechanical motion without losing quantum information. This enhancement works for systems with a weak optomechanical coupling and/or strong mechanical damping. This could allow for larger mechanical bandwidth of quantum limited detectors based on optomechanical devices. Our approach can be straightforwardly extended to Quantum Non Demolition (QND) qubit detection.