Save Big on your Mortgage
Here's a simple trick to reduce the repayment period of your mortgage and save thousands of dollars over the course of your loan: Make extra payments that go toward the loan principal. People accomplish this goal in several different ways. For many people,Perhaps the easiest way to organize this process is to make 1 additional mortgage payment per year. If you can't pay an extra whole payment in one month, you can divide your payment by 12 and write a check for that additional amount monthly. Another popular option is to pay half of your payment every other week. The result is you will make one additional monthly payment every year. Each of these options produces different results, but they will all significantly reduce the duration of your mortgage and lower your total interest paid.
Lump Sum Extra Payment
It may not be possible for you to pay extra every month or even every year. Remember that most mortgages will allow you to pay extra on your principal at any point during repayment. You can take advantage of this provision to pay down your principal any time you get some extra money. If, for example, you receive an unexpected windfall three years into your mortgage, paying a few thousand dollars into your home's principal will significantly reduce the period of your loan and save a huge amount on mortgage interest paid over the life of the mortgage loan. Unless the loan is very large, even small amounts applied early can produce huge benefits over the duration of the loan.
Cal Coast Financial Corp can walk you the mortgage process. Give us a call: (510) 683-9850.
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