Simple Ways to Save Big on Your Mortgage
There's a simple trick to significantly reduce the length of your mortgage and save you thousands of dollars over the course of your loan: Make additional payments that are applied toward your principal. Borrowers use different methods to accomplish this goal. Paying a single extra full payment once a year may be the easiest to track. But some people will not be able to pull off such a large extra expense, so dividing an additional payment into twelve extra monthly payments is a fine option too. Finally, you can commit to paying a half payment every other week. Each option yields slightly different results, but each will significantly reduce the length of your mortgage and lower your total interest paid.
Lump Sum Extra Payment
Some borrowers just can't make extra payments. But remember that most mortgage contracts will allow additional payments at any time. You can benefit from this provision to pay extra on your principal any time you come into extra money. For example: five years after buying your home, you get a very large tax refund,a large legacy, or a cash gift; , paying several thousand dollars into your home's principal will shorten the repayment period of your loan and save a huge amount on interest over the duration of the mortgage loan. Unless the mortgage loan is quite large, even small amounts applied early in the loan period can yield huge benefits over the duration of the loan.
Carter Financial Solutions can walk you through the pitfalls of getting a mortgage. Give us a call at 866-840-8745 x2.
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