Save on your Mortgage

Here's a simple trick to significantly reduce the length of your mortgage and save you thousands over the course of your loan: Make extra payments which apply to your loan principal. Borrowers can pay extra on principal by employing various techniques. For many people,Perhaps the simplest way to keep track is by making 1 additional payment a year. Of course, many people will not be able to afford such a large additional payment, so dividing an extra payment into twelve extra monthly payments works as well. Finally, you can commit to paying a half payment every other week. These options differ slightly in reducing the total interest paid and shortening payback length, but they will all significantly shorten the duration of your mortgage and lower the total interest paid 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 remember that most mortgages allow additional payments at any time. Any time you get some unexpected cash, consider using this rule to make an additional one-time payment on principal.

If, for example, you were to receive a large gift or tax refund five years into your mortgage, you could pay this windfall toward your loan principal, resulting in huge savings and a shortened payback period. For most loans, even a relatively modest amount, paid early enough in the mortgage, could offer big savings in interest and in the length of the loan.

Not Your Average Lender can walk you At Not Your Average Lender, we answer questions about money-saving strategies every day. Give us a call: 9722039033.