There's a trick to reduce the repayment period of your mortgage and save you thousands over the course of your loan: Make additional payments which apply toward your principal. People make this happen in several different ways. For many people,Perhaps the simplest way to organize this process is by making one extra payment a year. Of course, some people can't pull off such a large additional payment, so splitting an additional payment into twelve additional monthly payments is a great option too. Another popular option is to pay a half payment every other week. The effect here is that you make one additional monthly payment in a year. Each option produces slightly different results, but each will significantly reduce the length of your mortgage and lower your total interest paid.
Some people can't manage extra payments. But you should remember that most mortgages will allow you to make additional payments at any time. You can benefit from this provision to pay extra on your principal when you come into extra money. Here's an example: several years after moving into your home, you get a huge tax refund,a large inheritance, or a non-taxable cash gift; , you could apply this windfall toward your loan principal, resulting in huge savings and a shorter loan period. For most loans, even this relatively modest amount, paid early in the loan period, could offer big savings in interest and length of the loan.
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