Paying regular additional payments on the loan principal yields singificant returns. You can do this in various ways. For many people,Perhaps the simplest way to keep track is to make one extra mortgage payment per year. But many people will not be able to pull off this huge extra expense, so dividing one additional payment into twelve additional monthly payments works too. Finally, you can commit to paying a half payment every other week. Each option produces different results, but they will all significantly reduce the duration of your mortgage and lower your total interest paid.
Lump-sum Additional Payment
Some borrowers can't manage any extra payments. But it's important to note that most mortgages allow additional principal payments at any time. Any time you come into extra cash, consider using this provision to make an additional one-time payment on principal. If, for example, you receive a large gift or tax refund five years into your mortgage, you could pay this money toward your loan principal, resulting in huge savings and a shortened loan period. Unless the loan is very large, even a few thousand dollars applied early in the loan period can produce huge savings over the duration of the loan.
Carter Financial Solutions can walk you At Carter Financial Solutions, we answer questions about money-saving strategies almost every day. Call us: 866-840-8745 x2.
Looking to Buy?
Are you looking to buy a house? Let us help you. Just fill out as much of the information below that you want and we'll get right back to you, with no obligation to you. We guarantee your privacy.