Simple Ways to Save Big 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 that are applied toward your loan principal. Borrowers can do this using a few different techniques. Making 1 extra full payment one time a year is probably the simplest to keep track of. Of course, some people won't be able to afford this huge additional payment, so splitting one additional payment into 12 additional monthly payments works too. Another very popular option is to pay a half payment every other week. The effect here is that you will make one additional monthly payment in a year. Each of these options produces different results, but they will all significantly reduce the duration of your mortgage and lower your total interest paid.

Lump Sum Extra Payment

It may not be possible for you to pay more every month or even every year. Remember that virtually all mortgages will allow you to make additional payments to your principal at any time. You can take advantage of this rule to pay extra on your mortgage principal when you get some extra money.

If, for example, you were to receive a large gift or tax refund just a few years into your mortgage, paying a few thousand dollars into your mortgage principal will shorten the duration of your loan and save a huge amount on mortgage interest over the duration of the loan. For most loans, even a relatively small amount, paid early in the loan period, could offer big savings in interest and duration of the loan.

Net Equity Financial Mortgage LLC can walk you Net Equity Financial Mortgage LLC can answer questions about these interest savings and many others. Call us: 2157413131.