There's a trick to reduce the repayment period of your mortgage and save thousands in interest: Make additional payments which apply to your principal. Borrowers can pay against principal in various ways. For many people,Perhaps the easiest way to organize this process is by making one extra mortgage payment per year. However, many people won't be able to afford such a large extra expense, so dividing an extra payment into twelve extra monthly payments is a fine option too. Another popular option is to pay a half payment every two weeks. The result is 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 length of your mortgage and lower the total interest you will pay over the duration of the loan.
Some borrowers can't manage extra payments. But it's important to note that most mortgage contracts allow additional principal payments at any time. Any time you come into unexpected money, you can use this provision to make an additional one-time payment toward principal.
If, for example, you were to receive an unexpected windfall four years into your mortgage, paying a few thousand dollars into your home's principal can significantly shorten the duration of your loan and save enormously on interest paid over the duration of the mortgage loan. Unless the mortgage loan is quite large, even a few thousand dollars applied early in the loan period can yield huge savings over the duration of the loan.
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