Making regular extra payments toward the loan principal yields singificant savings. You can accomplish this using a few different techniques. For many people,Perhaps the simplest way to organize this process is by making 1 additional payment every year. If you can't afford to pay an extra whole payment all at once, you can divide that payment by 12 and pay that additional amount monthly. Finally, you can pay a half payment every two weeks. These options differ a little in reducing the final payback amount and shortening payback length, but they will all significantly reduce the duration of your mortgage and lower the total interest paid over the duration of the loan.
Some folks can't manage 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 rule to pay extra on your principal when you come into extra money.
For example: five years after moving into your home, you get a huge tax refund,a large legacy, or a cash gift; , paying a few thousand dollars into your mortgage principal can shorten the repayment duration of your loan and save enormously on interest over the life of the loan. For most loans, even this small amount, paid early in the loan period, could offer big savings in interest and in the duration of the loan.
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