Additional Payments Provide Big Savings

There's a simple trick to reduce the repayment period of your mortgage and save you thousands over the course of your loan: Make extra payments that go to your loan principal. You can pay extra on principal by employing various techniques. For many people,Perhaps the simplest way to keep track is by making 1 additional payment every year. If you can't pay an extra whole payment in one month, you can split that large amount into 12 smaller payments and pay that additional amount monthly. Another popular option is to pay half of your payment every other week. The result is you will make one extra monthly payment in a year. These options differ a little in lowering 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.

Additional One-time payment

Some people just can't make any extra payments. But remember that most mortgage contracts will allow you to make additional principal payments at any time. You can take advantage of this provision to pay down your mortgage principal any time you get some extra money. Here's an example: a few years after moving into your home, you get a very large tax refund,a large legacy, or a cash gift; , paying several thousand dollars into your home's principal will significantly shorten the repayment duration of your loan and save enormously on interest over the life of the loan. Unless the mortgage loan is quite large, even a few thousand dollars applied early in the loan period can produce huge benefits over the life of the loan.

Wisdom Financial, Inc. can walk you the mortgage process. Give us a call: 7084996088.