Save Big on your Mortgage Loan

Making regular extra payments on the loan principal will provide singificant returns. You can accomplish this in several ways. Paying a single extra payment once every year is perhaps the simplest to arrange. If you can't afford to pay an extra whole payment all at once, you can divide that payment by 12 and pay that additional amount monthly. Another option is to pay a half payment every two weeks. The result is you will make one additional monthly payment each year. These options differ a little in lowering the final payback amount and reducing payback length, but each will significantly reduce the length 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 most mortgage contracts will allow you to make additional payments to your principal at any time. Any time you get some unexpected money, you can use this rule to make a one-time additional payment toward principal. Here's an example: a few years after buying your home, you receive a larger than expected tax refund,a large legacy, or a non-taxable cash gift; , paying a few thousand dollars into your home's principal will shorten the period of your loan and save enormously on mortgage interest paid over the life of the loan. Unless the mortgage loan is very large, even a few thousand dollars applied early can yield huge benefits over the life of the loan.

Channel Mortgage LLC can walk you Channel Mortgage LLC can answer questions about these interest savings and many others. Call us at (718) 639-9500.

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