Save Big on your Mortgage
Here's a simple trick to significantly reduce the length of your mortgage and save thousands in interest: Make extra payments that go toward the principal. You can accomplish this in several ways. For many people,Perhaps the simplest way to organize this process is to make one additional mortgage payment every year. If you can't afford to pay an extra whole payment in one month, you can divide that payment by 12 and write a check for that additional amount monthly. Another option is to pay half of your payment every two weeks. The result is you will make one extra monthly payment each year. These options differ slightly in reducing the final payback amount and shortening payback length, but each will significantly shorten the duration of your mortgage and lower your total interest paid.
One-time Additional Payment
Some borrowers can't manage extra payments. Keep in mind that most mortgage contracts will allow you to make additional payments to your principal at any time. You can take advantage of this provision to pay down your mortgage principal when you come into extra money. Here's an example: a few years after moving into your home, you get a huge tax refund,a very large inheritance, or a cash gift; , you could pay a portion of this windfall toward your loan principal, which would result in enormous savings and a shorter loan period. Unless the mortgage loan is very large, even modest amounts applied early in the loan period can yield huge savings over the duration of the loan.
America's Money Source can walk you At America's Money Source, we answer questions about money-saving strategies almost every day. Call us: (407) 898-7559.
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