There's a simple trick to significantly reduce the length of your mortgage and save you thousands in interest: Make extra payments that go to the loan principal. People use different methods to accomplish this goal. For many people,Perhaps the easiest way to organize this process is by making one extra payment per year. Of course, many people will not be able to pull off such an enormous extra payment, so dividing a single extra payment into twelve extra monthly payments is a fine option too. Finally, you can pay a half payment every two weeks. Each of these options yields slightly different results, but each will significantly reduce the length of your mortgage and lower the total interest paid over the duration of the loan.
Some people just can't make extra payments. But you should remember that most mortgages allow you to make additional principal payments at any time. Any time you get some unexpected cash, consider using this provision to make an additional one-time payment on your mortgage principal. Here's an example: several years after buying your home, you receive a very large tax refund,a very large legacy, or a cash gift; , paying a few thousand dollars into your home's principal will significantly reduce the repayment period of your loan and save enormously on mortgage interest paid over the life of the loan. For most loans, even this relatively small amount, paid early in the loan period, could offer huge savings in interest and duration of the loan.
Do you have a question regarding a mortgage program?