Simple Ways to Save Big on Your Mortgage

There's a simple trick to significantly reduce the length of your mortgage and save you thousands of dollars in interest: Make extra payments which go toward the loan principal. People pay extra in several ways. For many people,Perhaps the simplest way to organize this process is to make one additional payment every year. If you can't afford to pay an extra whole payment in one month, you can split that large amount into 12 smaller payments and pay that additional amount monthly. Finally, you can commit to paying half of your mortgage payment every two weeks. Each of these options produces slightly different results, but they will all significantly reduce the duration of your mortgage and lower the total interest you will pay over the duration of the loan.

Lump-sum Additional Payment

Some people can't manage extra payments. Remember that most mortgages will allow you to make additional payments to your principal at any time. Whenever you come into unexpected cash, consider using this provision to pay a one-time additional payment on your mortgage principal.

Here's an example: five years after buying your home, you receive a very large tax refund,a large inheritance, or a cash gift; , you could apply this windfall toward your loan principal, resulting in enormous savings and a shortened payback period. Unless the loan is very large, even a few thousand dollars applied early can yield huge savings over the duration of the loan.

Tenby J. Dahman The Dahman Team can walk you the mortgage process. Call us at 3038627760.