Save Big on Your Mortgage
Paying consistent additional payments toward the loan principal will yield singificant savings. Borrowers can accomplish this in several ways. Paying one extra payment one time a year may be the simplest to arrange. If you can't 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 option is to pay a half payment every two weeks. The effect here is that you make one extra monthly payment each year. Each of these options yields different results, but they will all significantly reduce the duration 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 down your principal every month or even every year. Keep in mind that almost all mortgages will permit you to make additional payments to your principal at any point during repayment. You can take advantage of this provision to pay down your mortgage principal any time you get some extra money.
For example: several years after buying your home, you get a huge tax refund,a very large inheritance, or a cash gift; , you could pay a portion of this money toward your mortgage loan principal, which would result in significant savings and a shortened loan period. For most loans, even this small amount, paid early in the loan period, could offer big savings in interest and duration of the loan.
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