Simple Ways to Save Big on Your Mortgage

Here's a simple trick to reduce the repayment period of your mortgage and save thousands in interest: Make additional payments that apply toward your loan principal. People use different methods to meet this goal. For many people,Perhaps the simplest way to keep track is by making one extra payment a year. But some people can't swing such a large extra expense, so splitting an extra payment into twelve additional monthly payments is a fine option too. Another popular option is to pay a half payment every two weeks. The effect here is that you make one extra monthly payment each year. These options differ slightly in reducing the total interest paid and reducing payback length, but each will significantly reduce the duration of your mortgage and lower your total interest paid.

Lump Sum Extra Payment

Some people can't manage any extra payments. Remember that most mortgage contracts will permit you to make additional payments to your principal at any point during repayment. You can take advantage of this provision to pay extra on your mortgage principal any time you get some extra money.

If, for example, you were to receive an unexpected windfall just a few years into your mortgage, you could pay a portion of this money toward your loan principal, which would result in huge savings and a shortened loan period. Unless the mortgage loan is very large, even a few thousand dollars applied early can produce huge benefits over the life of the loan.

Channel Mortgage LLC can walk you At Channel Mortgage LLC, we answer questions about money-saving strategies every day. Give us a call at (718) 639-9500.

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