Mortgage Saving

There's a trick to reduce the repayment period of your mortgage and save thousands of dollars in interest: Make additional payments that apply toward your loan principal. Borrowers use different methods to meet this goal. Making a single additional full payment one time a year may be the simplest to arrange. If you can't pay an additional whole payment in one month, you can divide your payment by 12 and write a check for that additional amount monthly. Another very popular option is to pay a half payment every two weeks. The effect here is that you will make one extra monthly payment each year. Each option produces slightly different results, but they will all significantly reduce the length of your mortgage and lower the total interest paid over the life of the loan.

Lump-sum Additional Payment

Some folks can't manage extra payments. Remember that virtually all mortgages will permit you to make additional payments to your principal at any time. Whenever you get some unexpected money, you can use this provision to make an additional one-time payment toward principal.

For example: several years after buying your home, you receive a very large tax refund,a large legacy, or a cash gift; , you could pay a portion of this money toward your mortgage loan principal, resulting in enormous savings and a shorter loan period. For most loans, even this small amount, paid early enough in the mortgage, could offer big savings in interest and duration of the loan.

SelectPlus Lending can walk you through the pitfalls of getting a mortgage. Call us at 844-773-1401.

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