Save on Your Mortgage
Making consistent additional payments toward the loan principal provides enormous savings. People pay extra in several different ways. Paying 1 extra full payment once a year is probably the easiest to track. If you can't pay an additional whole payment all at once, you can divide your payment by 12 and pay that additional amount monthly. Another very popular option is to pay a half payment every two weeks. The result is you make one extra monthly payment in a year. Each of these options yields slightly different results, but each will significantly shorten 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 mortgage contracts allow you to make additional principal payments at any time. You can benefit from this rule to pay extra on your principal when you get some extra money. If, for example, you were to receive a very large gift or tax refund four years into your mortgage, 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 very large, even a few thousand dollars applied early can yield huge benefits over the duration of the loan.
Washingtonian Mortgage, LLC can walk you At Washingtonian Mortgage, LLC, we answer questions about interest-saving strategies almost every day. Give us a call: 410-451-2755.