There's a trick to reduce the repayment period of your mortgage and save you thousands over the course of your loan: Make extra payments which go toward the principal. People employ various techniques to meet this goal. For many people,Perhaps the simplest way to organize this process is to make one extra mortgage payment every year. However, some people can't pull off this huge additional expense, so dividing one additional payment into 12 additional monthly payments works as well. Another option is to pay half of your payment every other week. The result is you will make one extra monthly payment in a year. Each of these options yields different results, but they will all significantly reduce the duration of your mortgage and lower the total interest you will pay over the duration of the loan.
Some borrowers just can't make extra payments. Remember that almost all mortgages will permit you to make additional payments to your principal at any point during repayment. Any time you get some unexpected money, you can use this rule to make an additional one-time payment on principal. Here's an example: a few years after buying your home, you get a larger than expected tax refund,a very large inheritance, or a cash gift; , you could pay a portion of this windfall toward your loan principal, which would result in significant savings and a shorter loan period. Unless the mortgage loan is quite large, even a few thousand dollars applied early can yield huge benefits over the duration of the loan.
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