Making consistent additional payments toward the loan principal will provide huge savings. You pay against principal by employing various techniques. For many people,Perhaps the simplest way to organize this process is to make 1 additional mortgage payment per year. Of course, many people can't swing such a large additional payment, so dividing a single extra payment into 12 extra monthly payments is a great option too. Another very popular option is to pay a half payment every two weeks. The result is you make one extra monthly payment every year. Each of these options yields different results, but each will significantly shorten the length of your mortgage and lower the total interest paid over the life of the loan.
It may not be possible for you to pay down your principal every month or even every year. But you should remember that most mortgage contracts allow additional principal payments at any time. Any time you get some extra money, you can use this rule to make a one-time additional payment on your mortgage principal. Here's an example: a few years after buying your home, you get a very large tax refund,a very large legacy, or a cash gift; , paying a few thousand dollars into your mortgage principal can significantly reduce the duration of your loan and save enormously on mortgage interest paid over the duration of the loan. For most loans, even a relatively modest amount, paid early in the mortgage, could offer huge savings in interest and in the duration of the loan.
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