Big Savings on Interest: Available to Anyone

There's a simple trick to reduce the repayment period of your mortgage and save you thousands of dollars in interest: Make extra payments that go toward the loan principal. You can accomplish this in various ways. For many people,Perhaps the easiest way to organize this process is by making one additional mortgage payment a year. If you can't afford to pay an extra whole payment in one month, you can divide your payment by 12 and pay that additional amount monthly. Another popular option is to pay a half payment every other week. The effect here is that you make one additional monthly payment every year. These options differ slightly in lowering the final payback amount and reducing payback length, but they will all significantly shorten the duration of your mortgage and lower your total interest paid.

Additional One-time 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 mortgages will allow additional payments at any time. You can take advantage of this rule to pay extra on your principal when you get some extra money. For example: several years after moving into your home, you get a huge tax refund,a very large inheritance, or a cash gift; , paying a few thousand dollars into your mortgage principal will shorten the period of your loan and save enormously on interest over the life of the mortgage loan. For most loans, even this modest amount, paid early enough in the loan period, could offer huge savings in interest and length of the loan.

Homewood Mortgage, Inc. can walk you Homewood Mortgage, Inc. has your mortgage answers. Give us a call: 205-941-1484.

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