Save Big on Your Mortgage
Paying regular additional payments toward the loan principal will yield enormous savings. You can pay more on principal by employing various techniques. Making a single extra payment one time every year is perhaps the simplest to track. If you can't afford to pay an extra whole payment all at once, you can divide that payment by 12 and write a check for that additional amount monthly. Finally, you can pay a half payment every other week. Each of these options yields slightly different results, but they will all significantly reduce the length of your mortgage and lower your total interest paid.
Lump Sum Extra Payment
It may not be possible for you to pay down your principal every month or even every year. But it's important to note that most mortgages allow additional principal payments at any time. Any time 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 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, resulting in huge savings and a shortened payback period. Unless the loan is quite large, even modest amounts applied early in the loan period can produce huge benefits over the life of the loan.
Wisdom Financial, Inc. can walk you At Wisdom Financial, Inc., we answer questions about money-saving strategies almost every day. Give us a call at 708.499.6088.