Huge Savings on Interest: Available to Anyone
Making consistent extra payments toward your principal will provide singificant savings. People use different methods to accomplish this goal. For many people,Perhaps the easiest way to keep track is by making 1 extra payment every year. But many people won't be able to swing such an enormous additional payment, so splitting an extra payment into twelve additional monthly payments is a fine option too. Finally, you can commit to paying a half payment every two weeks. Each option produces different results, but each will significantly shorten the duration of your mortgage and lower your total interest paid.
Lump Sum Extra Payment
It may not be possible for you to pay extra every month or even every year. But you should remember that most mortgage contracts will allow additional principal payments at any time. You can take advantage of this provision to pay down your principal when you come into extra money. If, for example, you were to receive a large gift or tax refund three years into your mortgage, you could pay a portion of this money toward your loan principal, which would result in significant savings and a shortened payback period. For most loans, even this small amount, paid early enough in the mortgage, could offer huge savings in interest and in the length of the loan.
Churchill Mortgage Company can walk you through the pitfalls of getting a mortgage. Call us: (703) 551-4107.