Here's a simple trick to reduce the repayment period of your mortgage and save you thousands of dollars over the course of your loan: Make additional payments that apply to your principal. You pay against principal in many different ways. For many people,Perhaps the easiest way to keep track is by making 1 additional payment per year. If you can't pay an extra whole payment in one month, you can split that large amount into 12 smaller payments and pay that additional amount monthly. Finally, you can commit to paying half of your mortgage payment every two weeks. Each of these options yields slightly different results, but each will significantly reduce the duration of your mortgage and lower your total interest paid.
It may not be possible for you to pay more every month or even every year. Remember that almost all mortgages will permit you to make additional payments to your principal at any point during repayment. You can take advantage of this rule to pay down your principal any time you get some extra money.
If, for example, you receive a surprise windfall five years into your mortgage, you could apply a portion of this money toward your mortgage loan principal, which would result in huge savings and a shorter loan period. Unless the mortgage loan is quite large, even small amounts applied early can produce huge savings over the duration of the loan.
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