Extra Payments Yield Huge Savings

Paying consistent extra payments toward the loan principal will provide singificant returns. You can pay more on principal in various ways. For many people,Perhaps the easiest way to keep track is to make one extra payment a year. If you can't afford to 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 commit to paying a half payment every other week. Each of these options produces different results, but they will all significantly shorten the length of your mortgage and lower your total interest paid.

Lump Sum Extra Payment

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 allow additional principal payments at any time. You can take advantage of this rule to pay extra on your mortgage principal when you get some extra money.

If, for example, you receive a surprise windfall four years into your mortgage, paying several thousand dollars into your home's principal can significantly reduce the repayment duration of your loan and save enormously on mortgage interest paid over the life of the mortgage loan. Unless the loan is very large, even a few thousand dollars applied early in the loan period can yield huge benefits over the life of the loan.

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

Got a Question?

Do you have a question? We can help. Simply fill out the form below and we'll contact you with the answer, with no obligation to you. We guarantee your privacy.

Your Information
Your Question