Mortgage Savings

Making regular extra payments toward the principal will yield singificant savings. You can do this in several ways. Making 1 extra payment one time per year is likely the simplest to arrange. If you can't pay an extra whole payment in one month, you can split that large amount into 12 smaller payments and pay that additional amount monthly. Finally, you can pay a half payment every other week. Each option produces slightly different results, but they will all significantly shorten the length of your mortgage and lower the total interest paid over the duration of the loan.

Lump Sum Extra Payment

It may not be possible for you to pay more every month or even every year. But it's important to note that most mortgages allow additional principal payments at any time. You can take advantage of this rule to pay extra on your principal when you come into extra money. If, for example, you receive an unexpected windfall four years into your mortgage, you could apply this money toward your mortgage loan principal, which would result in huge savings and a shorter payback period. For most loans, even a relatively small amount, paid early enough in the mortgage, could offer big savings in interest and length of the loan.

1st Credential Mortgage Inc can walk you through the pitfalls of getting a mortgage. Call us at (281) 778-0805.

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