Paying consistent extra payments on the principal will provide big returns. You pay against principal in many different ways. Making one extra payment one time a year is likely the simplest to keep track of. If you can't afford to pay an extra whole payment all at once, you can divide that payment by 12 and pay that additional amount monthly. Another very popular option is to pay half of your payment every other week. The effect here is that you make one extra monthly payment in a year. Each option yields slightly different results, but each will significantly shorten the duration of your mortgage and lower your total interest paid.
Some borrowers can't manage extra payments. Remember that almost all mortgage contracts will allow you to pay extra on your principal at any time. You can take advantage of this rule to pay extra on your principal any time you get some extra money. Here's an example: a few years after moving into your home, you receive a very large tax refund,a very large inheritance, or a non-taxable cash gift; , paying several thousand dollars into your home's principal can significantly reduce the period of your loan and save a huge amount on mortgage interest over the duration of the mortgage loan. For most loans, even this relatively small amount, paid early in the loan period, could offer big savings in interest and duration of the loan.
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