Making consistent additional payments on your principal will provide huge returns. Borrowers can accomplish this in several ways. Paying one additional payment one time a year is perhaps the easiest to arrange. If you can't afford to pay an additional whole payment all at once, you can divide that payment by 12 and write a check for that additional amount monthly. Finally, you can commit to paying a half payment every other week. Each option yields different results, but they will all significantly shorten the length of your mortgage and lower your total interest paid.
Some borrowers just can't make any extra payments. Remember that most mortgage contracts will allow you to pay extra on your principal at any point during repayment. Any time you come into extra cash, consider using this rule to pay an additional one-time payment toward your principal.
For example: a few years after moving into your home, you receive a larger than expected tax refund,a large inheritance, or a cash gift; , paying several thousand dollars into your home's principal will significantly shorten the duration of your loan and save a huge amount on interest over the duration of the loan. Unless the loan is quite large, even modest amounts applied early can yield huge savings over the life of the loan.
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