Simple Ways to Save Big on Your Mortgage

Here's a simple trick to significantly reduce the length of your mortgage and save you thousands in interest: Make extra payments which apply toward your principal. You can accomplish this in various ways. Making a single extra payment one time per year is likely the simplest to keep track of. If you can't pay an additional whole payment all at once, you can divide that payment by 12 and write a check for that additional amount monthly. Another very popular option is to pay a half payment every two weeks. The effect here is that you make one extra monthly payment every year. Each of these options yields slightly different results, but they will all significantly shorten the length of your mortgage and lower the total interest paid over the life of the loan.

Lump Sum Extra Payment

Some borrowers just can't make extra payments. But you should remember that most mortgage contracts allow additional payments at any time. Any time you come into extra money, you can use this provision to make an additional one-time payment on your mortgage principal.

For example: a few years after moving into your home, you get a very large tax refund,a very large legacy, or a cash gift; , paying a few thousand dollars into your mortgage principal will reduce the duration of your loan and save enormously on mortgage interest paid over the life of the loan. Unless the loan is very large, even a few thousand dollars applied early can produce huge benefits over the life 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 interest-saving strategies almost every day. Give us a call at (808) 935-0678.