Making regular additional payments on your loan principal will provide singificant returns. People make this happen in a few different ways. Making a single extra full payment once per year may be the simplest to track. If you can't afford to pay an extra whole payment in one month, you can split that large amount into 12 smaller payments and write a check for that additional amount monthly. Another option is to pay a half payment every two weeks. The result is you will make one additional monthly payment each year. Each of these options produces different results, but each will significantly reduce the length of your mortgage and lower the total interest you will pay over the life of the loan.
It may not be possible for you to pay down your principal every month or even every year. But it's important to note that most mortgage contracts allow you to make additional payments at any time. You can take advantage of this rule to pay down your mortgage principal any time you come into extra money.
For example: five years after moving into your home, you receive a very large tax refund,a very large legacy, or a cash gift; , paying several thousand dollars into your home's principal can reduce the duration of your loan and save a huge amount on interest over the duration of the mortgage loan. For most loans, even a small amount, paid early enough in the mortgage, could offer big savings in interest and in the length of the loan.
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