There's a trick to reduce the repayment period of your mortgage and save thousands of dollars over the course of your loan: Make additional payments that apply to the loan principal. People accomplish this goal in a few ways. Paying one extra full payment one time per year is likely the easiest to arrange. Of course, many people can't pull off such a large extra payment, so dividing an additional payment into twelve additional monthly payments works as well. Another very popular option is to pay half of your payment every other week. The result is you will make one extra monthly payment in a year. These options differ slightly in lowering the final payback amount and reducing payback length, but each will significantly reduce the duration of your mortgage and lower your total interest paid.
Some folks just can't make extra payments. But you should remember that most mortgage contracts allow additional principal payments at any time. You can take advantage of this rule to pay down your principal any time you get some extra money.
If, for example, you receive a surprise windfall just a few years into your mortgage, investing several thousand dollars into your mortgage principal will shorten the period of your loan and save a huge amount on interest over the duration of the mortgage loan. Unless the loan is very large, even a few thousand dollars applied early in the loan period can yield huge savings over the life of the loan.
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