Big Interest Savings: Available to Anyone with a Mortgage

There's a trick to significantly reduce the length of your mortgage and save thousands over the course of your loan: Make additional payments which go toward your loan principal. Borrowers employ various techniques to accomplish this goal. Making 1 additional payment once a year may be the simplest to keep track of. If you can't afford to pay an additional whole payment all at once, you can divide that payment by 12 and write a check for that additional amount monthly. Another popular option is to pay half of your payment every other week. The effect here is that you make one extra monthly payment every year. These options differ a little in lowering the total interest paid and reducing payback length, but each will significantly reduce the length of your mortgage and lower your total interest paid.

Additional One-time payment

It may not be possible for you to pay more every month or even every year. Remember that virtually all mortgages will allow you to make additional payments to your principal at any time. You can take advantage of this rule to pay extra on your mortgage principal any time you get some extra money. If, for example, you receive a very large gift or tax refund five years into your mortgage, you could apply a portion of this windfall toward your mortgage loan principal, which would result in significant savings and a shortened loan period. For most loans, even a modest amount, paid early enough in the mortgage, could offer big savings in interest and in the length of the loan.

Tenby J. Dahman The Dahman Team can walk you At Tenby J. Dahman The Dahman Team , we answer questions about money-saving strategies almost every day. Give us a call at 3038627760.