Additional Payments Provide Big Mortgage Savings
Here's a simple trick to significantly reduce the length of your mortgage and save thousands over the course of your loan: Make additional payments that are applied toward your loan principal. People employ various techniques to accomplish this goal. For many people,Perhaps the simplest way to organize this process is to make 1 additional payment every year. If you can't afford to pay an additional whole payment all at once, you can divide your 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 result is you make one additional monthly payment each year. Each of these options produces different results, but each will significantly reduce the length of your mortgage and lower your total interest paid.
Lump Sum Extra Payment
Some borrowers can't manage any extra payments. Remember that most mortgages will permit you to make additional payments to your principal at any point during repayment. Whenever you get some unexpected cash, consider using this rule to pay an additional one-time payment on your mortgage principal. For example: several years after moving into your home, you get a very large tax refund,a large legacy, or a cash gift; , you could apply this windfall toward your loan principal, which would result in enormous savings and a shortened payback period. For most loans, even a small amount, paid early enough in the mortgage, could offer big savings in interest and duration of the loan.
Omni Mortgage Company, Inc. can walk you through the pitfalls of getting a mortgage. Give us a call: 603-893-6616.