Save on Your Mortgage
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Here's a simple trick to reduce the repayment period of your mortgage and save you thousands of dollars in interest: Make additional payments that go to the loan principal. People use different methods to accomplish this goal. For many people,Perhaps the easiest way to organize this process is to make one additional payment a year. If you can't pay an additional whole payment all at once, you can split that large amount into 12 smaller payments and pay that additional amount monthly. Finally, you can commit to paying half of your mortgage payment every other week. Each option produces different results, but they will all significantly shorten the length of your mortgage and lower your total interest paid.
Lump Sum Extra Payment
Some folks can't manage extra payments. But remember that most mortgage contracts allow you to make additional payments at any time. Any time you come into unexpected money, you can use this provision to pay a one-time additional payment on your principal.
If, for example, you receive a very large gift or tax refund four years into your mortgage, you could apply this windfall toward your loan principal, resulting in significant savings and a shortened loan period. Unless the mortgage loan is very large, even a few thousand dollars applied early can produce huge benefits over the life of the loan.
Pacific Coast Funding has your mortgage answers. Give us a call at 714 969-3112.