Additional Payments Yield Big Mortgage Savings
Paying regular extra payments toward the principal balance will yield singificant returns. People pay extra in a few ways. Making a single additional payment one time a year may be the easiest to arrange. But some people can't pull off this huge extra expense, so splitting one additional payment into 12 extra monthly payments is a great option too. Finally, you can commit to paying a half payment every other week. Each of these options yields slightly 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 Extra Payment
It may not be possible for you to pay extra every month or even every year. But you should remember that most mortgages allow additional payments at any time. Any time you get some unexpected cash, consider using this rule to pay an additional one-time payment on mortgage principal.
For example: five years after moving into your home, you get a very large tax refund,a very large inheritance, or a cash gift; , you could pay a portion of this money toward your mortgage loan principal, which would result in enormous savings and a shorter loan period. Unless the loan is very large, even a few thousand dollars applied early can yield huge savings over the duration of the loan.
Executive Lending Group, LLC can walk you the mortgage process. Give us a call at (816) 525-8000 & (81.
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