Making consistent additional payments on the principal balance can yield big returns. Borrowers make this happen in several ways. Making one extra payment once every year is likely the easiest to keep track of. If you can't afford to pay an extra whole payment in one month, you can divide your payment by 12 and pay that additional amount monthly. Another very popular option is to pay a half payment every other week. The effect here is that you make one extra monthly payment in a 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 paid over the duration of the loan.
Some borrowers can't manage extra payments. But you should remember that most mortgage contracts will allow additional principal payments at any time. You can benefit from this provision to pay extra on your principal any time you come into extra money. For example: five years after buying your home, you receive a huge tax refund,a very large legacy, or a cash gift; , paying several thousand dollars into your mortgage principal can shorten the period of your loan and save enormously on interest paid over the duration of the mortgage loan. Unless the mortgage loan is very large, even a few thousand dollars applied early can yield huge benefits over the life of the loan.
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