Paying consistent additional payments toward your loan principal yields singificant savings. Borrowers can do this using a few different techniques. Making a single additional payment once per year is probably the simplest to track. If you can't 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 very popular option is to pay a half payment every two weeks. The result is you make one extra monthly payment every year. These options differ a little in reducing the total interest paid and shortening payback length, but each will significantly reduce the duration of your mortgage and lower the total interest paid over the life of the loan.
It may not be possible for you to pay extra every month or even every year. But you should remember that most mortgage contracts allow you to make additional payments at any time. You can benefit from this rule to pay extra on your principal any time you get some extra money. For example: several years after buying your home, you get a larger than expected tax refund,a large legacy, or a cash gift; , you could pay this windfall toward your mortgage loan principal, resulting in enormous savings and a shorter loan period. Unless the loan is very large, even a few thousand dollars applied early can yield huge savings over the life of the loan.
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