2 Major Tips To Paying Your Mortgage Down Quicker

2 Major Tips To Paying Your Mortgage Down Quicker

There are three major tips that I can give in order to pay your mortgage down faster than you thought possible. Both require little or no extra out of pocket money by the mortgage holder.

My #1 tip is Pay bi weekly. This might sound silly or even pointless, but if you pay biweekly, you can cut years off your 30 year mortgage. This method requires ZERO extra dollars spent, its just simply a change in your mindset. So for example, your mortgage is $1,000 a month, instead of paying this on the 1st of every month, make a $500 payment on the 15th and one on the 1st of every month. This means that for two weeks out of every month, you are not paying interest on half of your mortgage.  If you look at the break down of a 30 year mortgage, the majority of the first 10-15 years is interest. By paying early, you are applying more of your monthly payment to the principle. 

Tip #2 make one extra payment a year. Now even if this isn't possible all the time, every little bit helps. On average, a person who pays one extra payment a year can cut 7 years off their mortgage! 7 YEARS! This doesn't mean you have to cause yourself undo stress one month of the year, just think of it this way. $1000 divided by 12 months equals $83.33. So add $83 a month to your payment. If you combo pack this with tip one, that is $41.50 dollars every two weeks. Which sounds a little bit better than $1000. 

Tip #3 Pay early, don't wait. So most companies offer automatic mortgage payment with draw, sounds great right. Well, most banks also don't allow you to pay more or on a different schedule than once a month standard payments. So, if you can set yourself a reminder to make your own payments, do it! Combine tips 1 and 2 and then if you can pay a day early. If possible make your payment as early in the month as you can. You are then cutting interest accrued.

Just using one of these tips can help you pay off your home faster, combining all three could significantly reduce the life of your home loan! 

Rick Blake Headshot
Phone: 727-244-7596
Dated: February 27th 2017
Views: 241
About Rick: ...

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