Making regular extra payments on your principal balance will provide enormous savings. Borrowers use different methods to meet this goal. Paying 1 extra payment once every year is likely the easiest to keep track of. But many people won't be able to pull off such an enormous extra expense, so dividing an additional payment into 12 additional monthly payments works too. Finally, you can pay a half payment every other week. These options differ a little in lowering the total interest paid and reducing payback length, but they will all significantly shorten the duration of your mortgage and lower your total interest paid.
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 will allow additional payments at any time. Any time you come into extra money, consider using this rule to make a one-time additional payment toward mortgage principal. For example: several years after buying your home, you get a huge tax refund,a large legacy, or a non-taxable cash gift; , investing several thousand dollars into your mortgage principal will shorten the period of your loan and save a huge amount on interest over the duration of the loan. For most loans, even a relatively modest amount, paid early enough in the mortgage, could offer big savings in interest and in the length of the loan.
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