Huge Savings on Interest: Available to Anyone with a Mortgage
Here's a simple trick to reduce the repayment period of your mortgage and save thousands of dollars in interest: Make extra payments which apply to the loan principal. You can do this in several ways. Paying a single additional payment one time every year is likely the simplest to arrange. But some folks can't swing such an enormous additional expense, so splitting a single extra payment into 12 additional monthly payments is a fine option too. Another option is to pay half of your payment every other week. The effect here is that you will make one extra monthly payment in a year. These options differ slightly in reducing the final payback amount and reducing payback length, but they will all significantly reduce the duration of your mortgage and lower your total interest paid.
One-time Additional Payment
Some folks just can't make any extra payments. Keep in mind that virtually all mortgage contracts will permit you to pay extra on your principal at any point during repayment. Any time you come into extra money, consider using this rule to make a one-time additional payment toward your mortgage principal.
For example: several years after buying your home, you get a huge tax refund,a very large inheritance, or a non-taxable cash gift; , paying a few thousand dollars into your home's principal can reduce the duration of your loan and save a huge amount on mortgage interest over the duration of the loan. Unless the loan is quite large, even a few thousand dollars applied early can yield huge benefits over the duration of the loan.
Savers Home Loans can walk you At Savers Home Loans, we answer questions about interest-saving strategies almost every day. Give us a call: (800) 974-0509.