There's a trick to significantly reduce the length of your mortgage and save thousands in interest: Make extra payments which are applied to your loan principal. Borrowers can do this using a few different techniques. Making one extra full payment once per year is likely the simplest to arrange. If you can't afford to pay an additional whole payment in one month, you can split that large amount into 12 smaller payments and pay that additional amount monthly. Another option is to pay a half payment every two weeks. The effect here is that you will make one extra monthly payment every year. These options differ a little in lowering the final payback amount and reducing payback length, but each will significantly shorten the duration of your mortgage and lower your total interest paid.
It may not be possible for you to pay extra every month or even every year. But you should remember that most mortgages will allow you to make additional principal payments at any time. Whenever you get some extra cash, consider using this provision to pay a one-time additional payment toward mortgage principal. For example: five years after moving into your home, you receive a very large tax refund,a large inheritance, or a cash gift; , investing a few thousand dollars into your mortgage principal will significantly shorten the repayment duration of your loan and save a huge amount on interest over the duration of the loan. Unless the loan is very large, even a few thousand dollars applied early in the loan period can produce huge savings over the duration of the loan.
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