Mortgage Saving Tips

There's a simple trick to significantly reduce the length of your mortgage and save thousands of dollars in interest: Make additional payments which are applied toward your principal. You can pay against principal in various ways. For many people,Perhaps the easiest way to organize this process is by making one extra mortgage payment a year. If you can't pay an extra whole payment all at once, you can divide your payment by 12 and write a check for that additional amount monthly. Another option is to pay a half payment every other week. The result is you make one additional monthly payment in a year. Each option produces different results, but they will all significantly shorten the length of your mortgage and lower the total interest you will pay over the life of the loan.

Lump Sum Extra Payment

It may not be possible for you to pay extra every month or even every year. But remember that most mortgages allow you to make additional principal payments at any time. You can take advantage of this rule to pay extra on your principal when you get some extra money. Here's an example: several years after moving into your home, you get a very large tax refund,a large inheritance, or a non-taxable cash gift; , paying several thousand dollars into your home's principal can significantly reduce the duration of your loan and save a huge amount on mortgage interest over the duration of the loan. For most loans, even this modest amount, paid early in the loan period, could offer big savings in interest and in the length of the loan.

Refresh Funding can walk you through the pitfalls of getting a mortgage. Give us a call at 305-800-3863.

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