Big Interest Savings: Available to Anyone with a Mortgage

Making consistent extra payments toward your principal balance will provide big returns. You can do this in several ways. Making one additional payment once every year may be the simplest to arrange. If you can't pay an extra whole payment all at once, you can split that large amount into 12 smaller payments and pay that additional amount monthly. Another option is to pay half of your payment every two weeks. The effect here is that you will make one additional monthly payment each year. These options differ a little in lowering the final payback amount and shortening payback length, 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.

Additional One-time payment

It may not be possible for you to pay more every month or even every year. But you should remember that most mortgages allow you to make additional payments at any time. You can benefit from this rule to pay down your mortgage principal any time you get some extra money. If, for example, you were to receive an unexpected windfall four years into your mortgage, investing a few thousand dollars into your home's principal will significantly reduce the repayment duration of your loan and save enormously on mortgage interest paid over the life of the mortgage loan. Unless the loan is quite large, even modest amounts applied early can yield huge savings over the life of the loan.

Stepping Stone Mortgage can walk you through the pitfalls of getting a mortgage. Call us at (541) 683-3300.

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