Save on your Mortgage
Paying consistent additional payments toward your principal provides enormous savings. Borrowers pay against principal in many different ways. For many people,Perhaps the simplest way to keep track is to make 1 additional mortgage payment per 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 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 produces different results, but each will significantly shorten the duration of your mortgage and lower the total interest you will pay over the duration of the loan.
Lump-sum Additional Payment
It may not be possible for you to pay down your principal every month or even every year. Keep in mind that most mortgages will allow you to make additional payments to your principal at any point during repayment. You can take advantage of this provision to pay down your principal any time you come into extra money. For example: a few years after moving into your home, you get a huge tax refund,a very large legacy, or a non-taxable cash gift; , investing a few thousand dollars into your mortgage principal can significantly reduce the duration of your loan and save enormously on interest paid over the duration of the loan. Unless the loan is very large, even small amounts applied early in the loan period can produce huge savings over the duration of the loan.
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