Paying consistent additional payments toward the principal will provide huge savings. Borrowers employ various techniques to meet this goal. Making one additional payment one time every year is perhaps the simplest to track. If you can't afford to pay an extra whole payment all at once, you can split that large amount into 12 smaller payments and write a check for that additional amount monthly. Finally, you can commit to paying a half payment every other week. These options differ a little in reducing the final payback amount and shortening payback length, but they will all significantly reduce the duration of your mortgage and lower the total interest paid over the duration of the loan.
It may not be possible for you to pay extra every month or even every year. Keep in mind that virtually all mortgages will allow you to pay extra on your principal at any time. You can take advantage of this rule to pay extra on your principal any time you come into extra money. Here's an example: a few years after moving into your home, you get a huge tax refund,a large inheritance, or a non-taxable cash gift; , you could apply a portion of this windfall toward your mortgage loan principal, resulting in huge savings and a shorter loan period. For most loans, even this relatively small amount, paid early in the loan period, could offer huge savings in interest and in the length of the loan.
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