There's a trick to reduce the repayment period of your mortgage and save thousands in interest: Make extra payments which apply to your principal. People make this happen in a few ways. For many people,Perhaps the easiest way to organize this process is by making one additional payment a year. If you can't pay an extra whole payment in one month, you can split that large amount into 12 smaller payments and write a check for that additional amount monthly. Another very popular option is to pay half of your payment every other week. The effect here is that you make one additional monthly payment each year. These options differ slightly in reducing the final payback amount and reducing payback length, but they will all significantly shorten 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. Keep in mind that most mortgages will allow you to make additional payments to your principal at any point during repayment. You can take advantage of this provision to pay extra on your principal when you come into extra money. Here's an example: five years after buying your home, you receive a larger than expected tax refund,a very large inheritance, or a non-taxable cash gift; , paying several thousand dollars into your home's principal can shorten the repayment period of your loan and save a huge amount on mortgage interest paid over the life of the loan. For most loans, even a small amount, paid early in the mortgage, could offer huge savings in interest and in the duration of the loan.
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