Making consistent additional payments on the principal balance will yield big savings. Borrowers make this happen in a few ways. Paying a single extra payment one time every year is perhaps the simplest to arrange. However, many folks won't be able to afford such an enormous additional payment, so dividing one additional payment into twelve extra monthly payments is a great option too. Finally, you can pay half of your mortgage payment every other week. Each of these options yields different results, but they will all significantly shorten the duration of your mortgage and lower the total interest you will pay over the duration of the loan.
Some folks can't manage extra payments. But remember that most mortgage contracts allow additional principal payments at any time. Whenever you get some unexpected cash, you can use this provision to make a one-time additional payment on your mortgage principal. If, for example, you receive a surprise windfall three years into your mortgage, you could apply this windfall toward your mortgage loan principal, which would result in enormous savings and a shorter payback period. Unless the mortgage loan is very large, even modest amounts applied early in the loan period can produce huge benefits over the life of the loan.
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