Paying regular extra payments on your loan principal will provide huge savings. Borrowers can do this in various ways. Paying one extra payment once per year is perhaps the easiest to keep track of. However, many people will not be able to swing such an enormous additional expense, so dividing an additional payment into 12 additional monthly payments is a great option too. Finally, you can commit to paying half of your mortgage payment every two weeks. These options differ slightly in reducing the total interest paid and shortening payback length, but they will all significantly shorten the length of your mortgage and lower the total interest you will pay over the duration of the loan.
Some borrowers just can't make any extra payments. Keep in mind that most mortgages will permit you to pay extra on your principal at any point during repayment. You can take advantage of this provision to pay extra on your principal any time you come into extra money. For example: several years after buying your home, you receive a huge tax refund,a very large legacy, or a cash gift; , you could pay this windfall toward your loan principal, which would result in significant savings and a shortened loan period. For most loans, even this small amount, paid early enough in the loan period, could offer big savings in interest and duration of the loan.
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