Save on your Mortgage Loan
Here's a simple trick to significantly reduce the length of your mortgage and save you thousands of dollars in interest: Make extra payments that apply toward your principal. Borrowers can pay more on principal by employing various techniques. Paying one extra payment one time every year is probably 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 option is to pay a half payment every two weeks. The effect here is that you will make one additional monthly payment in a year. Each of these options yields slightly different results, but they will all significantly reduce the duration of your mortgage and lower the total interest you will pay over the life of the loan.
One-time Additional Payment
It may not be possible for you to pay more every month or even every year. But it's important to note that most mortgage contracts allow you to make additional payments at any time. You can take advantage of this provision to pay extra on your principal any time you come into extra money.
If, for example, you were to receive a very large gift or tax refund just a few years into your mortgage, you could apply a portion of this windfall toward your mortgage loan principal, which would result in huge savings and a shortened loan period. Unless the mortgage loan is very large, even small amounts applied early can produce huge benefits over the life of the loan.
Equity Edge Mortgage, Inc. can walk you Equity Edge Mortgage, Inc. can answer questions about these interest savings and many others. Call us: 719-425-2226.