Save on your Mortgage
Here's a simple trick to significantly reduce the length of your mortgage and save you thousands of dollars over the course of your loan: Make extra payments which are applied to your loan principal. You can do this using a few different techniques. For many people,Perhaps the simplest way to organize this process is to make 1 additional payment per year. If you can't afford to pay an additional whole payment all at once, you can divide that payment by 12 and write a check for that additional amount monthly. Another very popular option is to pay a half payment every other week. The effect here is that you will make one extra monthly payment in a year. Each option produces slightly different results, but they will all significantly reduce the duration of your mortgage and lower the total interest you will pay over the duration of the loan.
One-time Additional Payment
Some folks can't manage any extra payments. But you should remember that most mortgages allow you to make additional principal payments at any time. You can benefit from this rule to pay down your principal when you come into extra money. Here's an example: several years after buying your home, you receive a huge tax refund,a very large legacy, or a non-taxable cash gift; , you could pay a portion of this money toward your mortgage loan principal, which would result in significant savings and a shorter loan period. Unless the mortgage loan is very large, even modest amounts applied early in the loan period can produce huge benefits over the duration of the loan.
Wisdom Financial, Inc. can walk you the mortgage process. Call us at 708.499.6088.