Reduce Your Amortization Period
Pay off your mortgage faster and you could save potentially thousands of dollars! How?
- You could choose a 15–year mortgage vs. a 30–year mortgage. The interest rate will be lower, the payment will be higher, but, if you can manage the higher payment, you will save 15 years worth of interest, which could total into a savings of hundreds of thousands of dollars! Whew!
- You can pay on your regular mortgage payment every two weeks instead of once a month. It doesn't cost you anything except for maybe the price of a stamp, and you have the potential to save big time! Everyday, the computer looks at your principal balance and charges your loan one day's interest based on that balance. The lower the principal balance, the lower the interest charged for the day. Every time you pay down your principal balance even a few pennies, you are helping yourself save on interest costs.
- If your regular mortgage payment is $1,225.00, try rounding up your payment to $1,300.00 or $1,250.00, or anything more than your regular payment. The extra money you send in will go directly towards principal, again chopping down the amount of interest you will pay.
- Anytime, you receive extra money, like a tax refund, use it to pay down your mortgage. There is no feeling like being completely debt free!!