Mortgage Saving

There's a simple trick to reduce the repayment period of your mortgage and save you thousands over the course of your loan: Make extra payments that go to your loan principal. Borrowers accomplish this goal in a few different ways. For many people,Perhaps the simplest way to keep track is to make 1 additional payment a year. If you can't afford to pay an additional whole payment all at once, you can divide your payment by 12 and pay that additional amount monthly. Finally, you can pay half of your mortgage payment every two weeks. Each of these options produces different results, but each will significantly shorten the length of your mortgage and lower your total interest paid.

One-time Additional Payment

It may not be possible for you to pay down your principal every month or even every year. But remember that most mortgage contracts allow additional principal payments at any time. You can take advantage of this provision to pay down your mortgage principal when you get some extra money.

If, for example, you were to receive a very large gift or tax refund four years into your mortgage, you could apply this windfall toward your mortgage loan principal, resulting in huge savings and a shorter payback period. Unless the mortgage loan is quite large, even a few thousand dollars applied early can produce huge savings over the duration of the loan.

Hawk Mortgage Group can walk you At Hawk Mortgage Group, we answer questions about interest-saving strategies every day. Give us a call at (443) 619-7900.

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