Huge Interest Savings: Available to Anyone
Paying regular extra payments toward your principal balance yields huge savings. You can accomplish this in various ways. Making a single additional payment once per year is likely the easiest to track. But some folks can't pull off such a large extra payment, so splitting an extra payment into twelve extra monthly payments works as well. Finally, you can pay half of your mortgage payment every other week. Each option yields slightly different results, but each will significantly reduce the length of your mortgage and lower your total interest paid.
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 pay extra on your principal at any point during repayment. You can benefit from this rule to pay extra on your principal when you come into extra money. If, for example, you receive a very large gift or tax refund five years into your mortgage, you could pay this windfall toward your mortgage loan principal, which would result in huge savings and a shortened payback period. For most loans, even this relatively small amount, paid early enough in the loan period, could offer huge savings in interest and in the length of the loan.