Here's a simple trick to reduce the repayment period of your mortgage and save you thousands in interest: Make extra payments which go to your principal. Borrowers use different methods to meet this goal. For many people,Perhaps the simplest way to keep track is by making 1 additional payment a year. If you can't afford to pay an extra whole payment all at once, you can split that large amount into 12 smaller payments and write a check for that additional amount monthly. Finally, you can pay a half payment every other week. Each option produces slightly different results, but they will all significantly reduce the length of your mortgage and lower your total interest paid.
Some folks can't manage any extra payments. But you should remember that most mortgage contracts allow you to make additional principal payments at any time. You can benefit from this provision to pay extra on your mortgage principal when you come into extra money. If, for example, you receive a surprise windfall just a few years into your mortgage, you could apply a portion of this money toward your loan principal, which would result in significant savings and a shorter loan period. Unless the mortgage loan is very large, even modest amounts applied early in the loan period can yield huge benefits over the life of the loan.
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