Save Big on Your Mortgage
Paying consistent extra payments on your principal balance can yield big savings. Borrowers can do this in several ways. Paying 1 extra payment one time a year is perhaps the simplest to track. But some folks will not be able to swing such an enormous additional payment, so dividing a single extra payment into twelve extra monthly payments works too. Finally, you can pay half of your mortgage payment every two weeks. These options differ slightly in reducing the final payback amount and shortening payback length, but they will all significantly shorten the duration of your mortgage and lower the total interest you will pay over the duration of the loan.
Additional One-time payment
Some borrowers can't manage any extra payments. Keep in mind that virtually all mortgages will allow you to pay extra on your principal at any time. Whenever you get some unexpected cash, you can use this rule to make a one-time additional payment on your mortgage principal.
For example: a few years after moving into your home, you receive a huge tax refund,a large inheritance, or a non-taxable cash gift; , you could pay a portion of this money toward your mortgage loan principal, resulting in huge savings and a shorter payback period. Unless the loan is very large, even a few thousand dollars applied early can yield huge savings over the duration of the loan.
Saab Mortgage can walk you Saab Mortgage can answer questions about these interest savings and many others. Call us: 703-288-0777.
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