Simple Ways to Save on Your Mortgage

Paying regular extra payments on the principal balance provides big returns. Borrowers can accomplish this using a few different techniques. Paying 1 extra full payment one time per year is probably the easiest to arrange. However, many people won't be able to swing such an enormous extra payment, so splitting an extra payment into twelve additional monthly payments works too. Finally, you can pay a half payment every two weeks. Each of these options produces slightly different results, but each will significantly reduce the duration of your mortgage and lower the total interest paid over the duration of the loan.

One-time Additional Payment

It may not be possible for you to pay extra every month or even every year. But remember that most mortgages allow additional principal payments at any time. Whenever you come into unexpected cash, consider using this provision to pay an additional one-time payment on principal. Here's an example: a few years after buying your home, you get a very large tax refund,a very large inheritance, or a cash gift; , paying several thousand dollars into your home's principal will shorten the repayment period of your loan and save enormously on mortgage interest over the duration of the loan. For most loans, even a modest amount, paid early in the mortgage, could offer big savings in interest and duration of the loan.

Atlantic Financial Services can walk you the mortgage process. Call us: (732) 969-9300.

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