Save on your Mortgage
Here's a simple trick to reduce the repayment period of your mortgage and save you thousands of dollars in interest: Make additional payments that are applied toward the loan principal. People use different methods to accomplish this goal. Making a single additional full payment once per year may be the easiest to track. However, many people will not be able to afford such a large extra payment, so splitting one extra payment into 12 extra monthly payments works too. Another option is to pay half of your payment every other week. The result is you make one extra monthly payment every year. Each option produces different results, but they will all significantly reduce the length of your mortgage and lower the total interest you will pay over the duration of the loan.
One-time Additional Payment
Some borrowers just can't make extra payments. But it's important to note that most mortgages allow additional payments at any time. Whenever you come into extra money, you can use this provision to pay a one-time additional payment on mortgage principal.
If, for example, you receive a surprise windfall three years into your mortgage, you could apply a portion of this money toward your mortgage loan principal, resulting in huge savings and a shortened payback period. For most loans, even a relatively modest amount, paid early in the mortgage, could offer big savings in interest and in the duration of the loan.
Valley Savers Mortgage, LLC can walk you At Valley Savers Mortgage, LLC, we answer questions about money-saving strategies almost every day. Call us at (602) 332-9544.
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