Paying consistent extra payments on the principal will provide huge returns. Borrowers can do this in several ways. Making 1 additional full payment one time every year is likely the easiest to track. But many folks can't afford such an enormous extra payment, so splitting an additional payment into twelve additional monthly payments is a fine option too. Another very popular option is to pay a half payment every two weeks. The result is you make one extra monthly payment in a year. Each option produces slightly different results, but each will significantly shorten the duration of your mortgage and lower the total interest you will pay over the duration of the loan.
It may not be possible for you to pay extra every month or even every year. Remember that most mortgages will permit you to make additional payments to your principal at any point during repayment. You can take advantage of this rule to pay extra on your mortgage principal when you get some extra money. Here's an example: five years after buying your home, you receive a larger than expected tax refund,a very large legacy, or a cash gift; , paying several thousand dollars into your mortgage principal can reduce the duration of your loan and save enormously on interest over the life of the loan. Unless the loan is very large, even a few thousand dollars applied early can yield huge benefits over the duration of the loan.
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