Mortgage Saving

Making consistent additional payments on your loan principal provides enormous returns. Borrowers accomplish this goal in several ways. For many people,Perhaps the simplest way to keep track is by making one extra payment per year. But some people can't afford this huge extra expense, so dividing one additional payment into 12 extra monthly payments works as well. Finally, you can pay a half payment every other week. These options differ slightly in reducing the final payback amount and shortening payback length, but they will all significantly shorten the length of your mortgage and lower your total interest paid.

One-time Additional Payment

It may not be possible for you to pay down your principal every month or even every year. Remember that almost all mortgage contracts will allow you to pay extra on your principal at any point during repayment. Any time you come into unexpected cash, consider using this rule to make an additional one-time payment toward principal.

If, for example, you were to receive a very large gift or tax refund just a few years into your mortgage, paying several thousand dollars into your mortgage principal will significantly shorten the period of your loan and save a huge amount on interest paid over the life of the loan. For most loans, even a modest amount, paid early in the loan period, could offer big savings in interest and duration of the loan.

1st Credential Mortgage Inc can walk you 1st Credential Mortgage Inc can answer questions about these interest savings and many others. Give us a call: (281) 778-0805.

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