There's a simple trick to significantly reduce the length of your mortgage and save thousands of dollars over the course of your loan: Make extra payments that go toward your loan principal. Borrowers can pay more on principal in various ways. For many people,Perhaps the easiest way to organize this process is by making one extra payment every year. If you can't pay an additional whole payment all at once, you can split that large amount into 12 smaller payments and pay that additional amount monthly. Finally, you can pay a half payment every two weeks. 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 life of the loan.
Some people just can't make any extra payments. But you should remember that most mortgages will allow additional payments at any time. You can benefit from this rule to pay down your mortgage principal when you come into extra money. If, for example, you receive a surprise windfall four years into your mortgage, paying a few thousand dollars into your home's principal will reduce the period of your loan and save a huge amount on mortgage interest paid over the life of the mortgage loan. Unless the mortgage loan is quite large, even a few thousand dollars applied early in the loan period can yield huge savings over the duration of the loan.
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