Mortgage Savings Tips
There's a simple trick to reduce the repayment period of your mortgage and save you thousands of dollars in interest: Make extra payments which are applied to your principal. Borrowers pay extra in several ways. Paying one extra payment one time every year is perhaps the simplest to arrange. If you can't afford to pay an extra whole payment in one month, you can divide that payment by 12 and pay that additional amount monthly. Another very popular option is to pay half of your payment every other week. The result is you make one additional monthly payment in a year. Each of these options produces different results, but they will all significantly shorten the duration of your mortgage and lower the total interest paid over the duration of the loan.
One-time Additional Payment
It may not be possible for you to pay extra every month or even every year. Remember that virtually all mortgages will allow you to make additional payments to your principal at any point during repayment. You can benefit from this provision to pay extra on your mortgage principal any time you get some extra money.
For example: several years after moving into your home, you get a huge tax refund,a large legacy, or a cash gift; , you could pay this money toward your loan principal, which would result in huge savings and a shorter loan period. Unless the mortgage loan is very large, even small amounts applied early can yield huge benefits over the life of the loan.
Affinity Mortgage Brokers can walk you the mortgage process. Call us: 719-425-2226.