Save on your Mortgage Loan
Paying consistent additional payments toward the principal will provide enormous savings. You pay more on principal in various ways. For many people,Perhaps the simplest way to organize this process is to make one additional payment every year. But many folks can't swing such an enormous additional payment, so dividing a single extra payment into twelve additional monthly payments works as well. Finally, you can commit to paying a half payment every two weeks. These options differ slightly in reducing the final payback amount and shortening payback length, but they will all significantly shorten the duration of your mortgage and lower your total interest paid.
Lump-sum Additional Payment
It may not be possible for you to pay more every month or even every year. Remember that virtually all mortgage contracts will allow you to pay extra on your principal at any time. You can take advantage of this rule to pay extra on your principal when you come into extra money.
For example: five years after buying your home, you receive a larger than expected tax refund,a very large legacy, or a non-taxable cash gift; , you could apply a portion of this money toward your mortgage loan principal, which would result in enormous savings and a shorter payback period. For most loans, even a relatively modest amount, paid early enough in the loan period, could offer big savings in interest and in the length of the loan.
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