Mortgage Savings Tips

Paying regular extra payments toward the loan principal provides enormous savings. People make this happen in several ways. Paying a single additional payment once every year may be the easiest to track. If you can't afford to pay an extra whole payment all at once, you can split that large amount into 12 smaller payments 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 each year. Each option produces slightly different results, but each will significantly reduce the duration of your mortgage and lower the total interest you will pay over the duration of the loan.

Lump-sum Additional Payment

Some people can't manage extra payments. Remember that almost all mortgage contracts will permit you to make additional payments to your principal at any point during repayment. You can benefit from this rule to pay down your mortgage principal when you come into extra money. Here's an example: five years after moving into your home, you receive a very large tax refund,a very large legacy, or a non-taxable cash gift; , you could apply this money toward your loan principal, resulting in significant savings and a shorter payback period. Unless the loan is very large, even modest amounts applied early can yield huge savings over the duration of the loan.

Family Mortgage Company of Hawaii, Inc. NMLS #244497 can walk you At Family Mortgage Company of Hawaii, Inc. NMLS #244497, we answer questions about money-saving strategies almost every day. Call us: (808) 935-0678.