Here's a simple trick to reduce the repayment period of your mortgage and save thousands in interest: Make extra payments that apply toward your principal. People use different methods to accomplish this goal. For many people,Perhaps the simplest way to keep track is by making 1 extra payment per year. If you can't afford to pay an extra whole payment all at once, you can split that large amount into 12 smaller payments and write a check for that additional amount monthly. Finally, you can pay half of your mortgage payment every two weeks. Each of these options produces slightly different results, but they will all significantly shorten the duration of your mortgage and lower your total interest paid.
It may not be possible for you to pay more every month or even every year. But you should remember that most mortgage contracts allow you to make additional principal payments at any time. You can take advantage of this provision to pay extra on your mortgage principal any time you come into extra money. Here's an example: several years after moving into your home, you get a huge tax refund,a very large inheritance, or a cash gift; , paying a few thousand dollars into your home's principal can shorten the duration of your loan and save enormously on interest paid over the duration of the mortgage loan. For most loans, even a modest amount, paid early in the loan period, could offer big savings in interest and in the length of the loan.
Do you have a question regarding a mortgage program?