Making regular additional payments toward the principal balance will yield singificant savings. People employ various techniques to meet this goal. For many people,Perhaps the simplest way to keep track is to make 1 additional payment a year. Of course, some people can't pull off such an enormous additional expense, so splitting a single additional payment into twelve additional monthly payments is a fine option too. Finally, you can pay a half payment every other week. These options differ slightly in reducing the final payback amount and shortening payback length, but they will all significantly reduce the duration of your mortgage and lower the total interest paid over the life of the loan.
Some folks can't manage extra payments. But you should remember that most mortgage contracts allow you to make additional payments at any time. Any time you come into extra cash, you can use this rule to pay a one-time additional payment on your principal. If, for example, you were to receive a very large gift or tax refund three years into your mortgage, paying several thousand dollars into your mortgage principal can significantly reduce the period of your loan and save a huge amount on interest paid over the life of the loan. Unless the mortgage loan is quite large, even modest amounts applied early in the loan period can produce huge benefits over the life of the loan.
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