There's a trick to significantly reduce the length of your mortgage and save thousands in interest: Make additional payments which are applied toward the principal. People accomplish this goal in several different ways. For many people,Perhaps the simplest way to organize this process is by making one extra payment every year. Of course, some people can't pull off such an enormous additional expense, so splitting a single extra payment into twelve extra monthly payments works as well. Another option is to pay a half payment every other week. The result is you make one extra monthly payment every year. Each option produces slightly different results, but they will all significantly reduce the length of your mortgage and lower your total interest paid.
Some folks just can't make any extra payments. Keep in mind that almost all mortgage contracts will permit you to make additional payments to your principal at any point during repayment. You can benefit from this rule to pay down your mortgage principal any time you come into extra money. If, for example, you receive an unexpected windfall five years into your mortgage, you could pay a portion of this windfall toward your mortgage loan principal, which would result in significant savings and a shorter payback period. For most loans, even this small amount, paid early enough in the mortgage, could offer big savings in interest and length of the loan.
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