Making consistent additional payments toward the loan principal provides enormous savings. Borrowers can do this using a few different techniques. For many people,Perhaps the simplest way to organize this process is to make 1 extra mortgage payment per year. If you can't afford to pay an extra whole payment all at once, you can divide that payment by 12 and write a check for that additional amount monthly. Finally, you can pay half of your mortgage payment every other week. These options differ a little in reducing the total interest paid and shortening payback length, but each will significantly shorten the duration of your mortgage and lower the total interest you will pay over the life of the loan.
Some people can't manage any extra payments. Keep in mind that almost all mortgages will permit you to pay extra on your principal at any point during repayment. You can benefit from this provision to pay down your principal any time you come into extra money. If, for example, you were to receive an unexpected windfall three years into your mortgage, paying several thousand dollars into your home's principal can reduce the period of your loan and save enormously on interest paid over the duration of the mortgage loan. Unless the mortgage loan is quite large, even a few thousand dollars applied early can produce huge savings over the life of the loan.
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