Making regular extra payments on the principal balance will provide enormous returns. Borrowers can do this in various ways. Paying one extra payment once a year is probably the easiest to keep track of. If you can't pay an additional whole payment all at once, you can divide that payment by 12 and pay that additional amount monthly. Finally, you can pay half of your mortgage 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 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. Keep in mind that most mortgage contracts will allow you to pay extra on your principal at any time. You can benefit from this provision to pay extra on your mortgage principal when you come into extra money.
For example: several years after moving into your home, you receive a very large tax refund,a large inheritance, or a cash gift; , you could pay a portion of this money toward your mortgage loan principal, resulting in huge savings and a shortened payback period. Unless the loan is quite large, even a few thousand dollars applied early can produce huge savings over the duration of the loan.
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