Huge Savings on Interest: Available to Anyone with a Mortgage
There's a trick to reduce the repayment period of your mortgage and save thousands of dollars over the course of your loan: Make extra payments which apply to the principal. People pay extra in a few different ways. Making one additional payment one time a year is probably the easiest to keep track of. 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 option is to pay a half payment every other week. The effect here is that you will make one extra monthly payment every year. These options differ a little 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 paid over the duration of the loan.
One-time Additional Payment
It may not be possible for you to pay down your principal every month or even every year. But you should remember that most mortgages allow you to make additional payments at any time. You can take advantage of this rule to pay extra on your mortgage principal any time you come into extra money.
If, for example, you were to receive an unexpected windfall five years into your mortgage, investing a few thousand dollars into your mortgage principal can reduce the repayment period of your loan and save a huge amount on mortgage interest paid over the duration of the loan. For most loans, even a modest amount, paid early in the loan period, could offer huge savings in interest and in the length of the loan.
Trustin Mortgage, LLC can walk you the mortgage process. Call us at (302) 765-8089.
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