Additional Payments Provide Huge Mortgage Savings

There's a simple trick to reduce the repayment period of your mortgage and save thousands in interest: Make additional payments that are applied toward your principal. People accomplish this goal in several different ways. For many people,Perhaps the easiest way to keep track is to make 1 extra payment every year. If you can't pay an additional whole payment all at once, you can divide that payment by 12 and pay that additional amount monthly. Another popular option is to pay half of your payment every other week. The effect here is that you will make one additional monthly payment every year. Each option produces different results, but they will all significantly shorten the length of your mortgage and lower the total interest paid over the life of the loan.

One-time Additional Payment

It may not be possible for you to pay more every month or even every year. But it's important to note that most mortgage contracts will allow additional payments at any time. You can benefit from this rule to pay down your mortgage principal any time you get some extra money.

For example: a few years after moving into your home, you receive a huge tax refund,a large legacy, or a cash gift; , paying several thousand dollars into your mortgage principal will reduce the repayment period of your loan and save a huge amount on interest over the life of the mortgage loan. For most loans, even a modest amount, paid early enough in the loan period, could offer big savings in interest and length of the loan.

Reliance Mortgage Service, Inc can walk you through the pitfalls of getting a mortgage. Give us a call at 562 320-0510.

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