Huge Interest Savings: Available to Anyone with a Mortgage
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 apply toward the principal. People pay extra in a few different ways. Paying a single additional full payment once a year is perhaps the simplest to arrange. If you can't afford to pay an extra whole payment all at once, you can divide that payment by 12 and write a check for that additional amount monthly. Another very popular option is to pay a half payment every two weeks. The result is you make one extra monthly payment each year. These options differ a little in reducing the total interest paid and reducing payback length, but each will significantly reduce the duration of your mortgage and lower your total interest paid.
Lump Sum Extra Payment
Some people just can't make any extra payments. But remember that most mortgage contracts allow additional principal payments at any time. Whenever you come into extra money, consider using this provision to pay a one-time additional payment on your principal.
Here's an example: a few years after buying your home, you get a huge tax refund,a very large legacy, or a cash gift; , you could apply a portion of this money toward your mortgage loan principal, resulting in huge savings and a shorter loan period. Unless the mortgage loan is very large, even small amounts applied early can produce huge savings over the life of the loan.
MidTowne Mortgage can walk you At MidTowne Mortgage, we answer questions about interest-saving strategies almost every day. Call us: (478) 746-2063.