Simple Ways to Save on Your Mortgage
Here's a simple trick to reduce the repayment period of your mortgage and save you thousands of dollars in interest: Make additional payments that go toward your loan principal. Borrowers can pay against principal in various ways. Paying 1 extra payment one time per year may be the simplest to track. If you can't pay an additional whole payment all at once, you can split that large amount into 12 smaller payments and write a check for that additional amount monthly. Finally, you can pay half of your mortgage payment every other week. Each of these options yields different results, but each will significantly reduce the length of your mortgage and lower the total interest paid over the life of the loan.
Lump Sum Extra Payment
Some folks can't manage any extra payments. Remember that almost all mortgages will allow you to pay extra on your principal at any point during repayment. You can take advantage of this provision to pay down your principal when you get some extra money.
Here's an example: a few years after moving into your home, you get a huge tax refund,a large legacy, or a non-taxable cash gift; , investing several thousand dollars into your home's principal will reduce the repayment period of your loan and save a huge amount on interest over the duration of the loan. For most loans, even a small amount, paid early enough in the mortgage, could offer huge savings in interest and in the duration of the loan.
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