Save on your Mortgage Loan

Here's a simple trick to significantly reduce the length of your mortgage and save you thousands in interest: Make additional payments that apply toward your loan principal. People employ various techniques to accomplish this goal. For many people,Perhaps the easiest way to keep track is to make 1 additional mortgage payment every year. But some folks can't pull off such a large additional payment, so splitting an extra payment into twelve extra monthly payments works too. Finally, you can commit to paying half of your mortgage payment every two weeks. Each of these options yields different results, but each will significantly reduce the length of your mortgage and lower the total interest you will pay over the life of the loan.

Lump Sum Extra Payment

It may not be possible for you to pay extra every month or even every year. But it's important to note that most mortgages will allow additional principal payments at any time. Any time you come into extra money, consider using this provision to pay a one-time additional payment on your mortgage principal. If, for example, you receive a surprise windfall four years into your mortgage, you could pay a portion of this windfall toward your loan principal, which would result in enormous savings and a shortened payback period. For most loans, even this modest amount, paid early in the loan period, could offer huge savings in interest and duration of the loan.