Mortgage Saving Tips

Here's a simple trick to reduce the repayment period of your mortgage and save you thousands of dollars over the course of your loan: Make extra payments that apply toward the principal. People use different methods to accomplish this goal. For many people,Perhaps the easiest way to organize this process is by making 1 additional mortgage payment per year. Of course, some folks can't afford such an enormous additional payment, so dividing an extra payment into twelve extra monthly payments is a fine option too. Finally, you can pay a half payment every other week. These options differ slightly in reducing the final payback amount and reducing payback length, but they will all significantly reduce the duration of your mortgage and lower your total interest paid.

Additional One-time payment

It may not be possible for you to pay extra every month or even every year. Keep in mind that virtually all mortgages will permit you to pay extra on your principal at any time. You can take advantage of this provision to pay down your principal any time you come into extra money. If, for example, you receive a very large gift or tax refund just a few years into your mortgage, you could apply a portion of this windfall toward your loan principal, which would result in significant savings and a shortened loan period. Unless the mortgage loan is very large, even a few thousand dollars applied early in the loan period can produce huge savings over the life of the loan.

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