Extra Payments Provide Huge Savings
Paying consistent additional payments toward your principal balance yields big returns. Borrowers can do this using a few different techniques. For many people,Perhaps the simplest way to keep track is by making one additional payment a year. But many people won't be able to pull off such a large additional expense, so splitting an additional payment into twelve additional monthly payments is a fine option too. Another option is to pay half of your payment every two weeks. The result is you will make one extra monthly payment in a year. Each option yields slightly different results, but each will significantly reduce the length of your mortgage and lower your total interest paid.
Additional One-time payment
Some people can't manage any extra payments. But remember that most mortgages allow you to make additional payments at any time. Whenever you come into unexpected money, consider using this rule to make an additional one-time payment toward mortgage principal. Here's an example: five years after buying your home, you receive a very large tax refund,a very large inheritance, or a non-taxable cash gift; , investing several thousand dollars into your home's principal can significantly shorten the period of your loan and save a huge amount on mortgage interest over the duration of the mortgage loan. For most loans, even a modest amount, paid early enough in the loan period, could offer huge savings in interest and in the length of the loan.