Extra Payments Yield Big Savings
Here's a simple trick to reduce the repayment period of your mortgage and save you thousands of dollars over the course of your loan: Make additional payments which apply toward the principal. You can pay against principal by employing various techniques. Paying 1 extra full payment one time a year is perhaps the easiest to arrange. However, some people will not be able to swing such an enormous additional payment, so splitting one extra payment into twelve additional monthly payments works as well. Another popular option is to pay half of your payment every other week. The result is you will make one additional monthly payment every year. Each of these options yields different results, but each will significantly shorten the duration of your mortgage and lower the total interest you will pay over the life of the loan.
Additional One-time payment
Some people just can't make any extra payments. But remember that most mortgages allow additional payments at any time. You can benefit from this provision to pay extra on your principal when you get some extra money. Here's an example: five years after buying your home, you receive a very large tax refund,a large legacy, or a cash gift; , paying a few thousand dollars into your mortgage principal can shorten the period of your loan and save a huge amount on interest paid over the duration of the loan. For most loans, even this small amount, paid early enough in the mortgage, could offer huge savings in interest and length of the loan.
F&T Mortgage, Inc. NMLS # 168839 (www.nmlsconsumeraccess.org) can walk you F&T Mortgage, Inc. NMLS # 168839 (www.nmlsconsumeraccess.org) can answer questions about these interest savings and many others. Give us a call at 214-300-8756.