Paying consistent additional payments on the loan principal will yield huge returns. Borrowers use different methods to meet this goal. Making a single additional full payment one time a year may be the simplest to arrange. If you can't pay an extra whole payment all at once, you can divide that payment by 12 and write a check for that additional amount monthly. Another very popular option is to pay half of your payment every two weeks. The result is you will make one extra monthly payment every year. Each of these options produces different results, but each will significantly reduce the length of your mortgage and lower the total interest paid over the life of the loan.
Some people can't manage extra payments. Remember that virtually all mortgages will allow you to pay extra on your principal at any point during repayment. You can benefit from this rule to pay extra on your mortgage principal any time you get some extra money. Here's an example: five years after moving into your home, you get a larger than expected tax refund,a very large legacy, or a cash gift; , you could apply a portion of this windfall toward your loan principal, which would result in enormous savings and a shortened payback period. Unless the loan is very large, even modest amounts applied early in the loan period can yield huge savings over the duration of the loan.
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