Huge Savings on Interest: Available to Anyone

Here's a simple trick to reduce the repayment period of your mortgage and save thousands over the course of your loan: Make extra payments which apply toward your loan principal. You pay more on principal by employing various techniques. For many people,Perhaps the easiest way to keep track is by making 1 extra mortgage payment per year. Of course, many people will not be able to afford such an enormous extra expense, so splitting a single additional payment into 12 extra monthly payments is a great option too. Finally, you can pay half of your mortgage payment every two weeks. These options differ slightly in lowering the final payback amount and reducing payback length, but they will all significantly reduce the length of your mortgage and lower your total interest paid.

Lump-sum Additional Payment

It may not be possible for you to pay down your principal every month or even every year. Remember that most mortgages will allow you to make additional payments to your principal at any time. Whenever you come into extra money, consider using this rule to pay a one-time additional payment toward mortgage principal. Here's an example: several years after moving into your home, you get a larger than expected tax refund,a large inheritance, or a non-taxable cash gift; , investing a few thousand dollars into your mortgage principal will reduce the duration of your loan and save enormously on mortgage interest paid over the duration of the mortgage loan. Unless the loan is very large, even a few thousand dollars applied early can yield huge benefits over the life of the loan.

Wisdom Financial, Inc. can walk you Wisdom Financial, Inc. can answer questions about these interest savings and many others. Give us a call: 708.499.6088.