Simple Ways to Save on Your Mortgage

Here's a simple trick to significantly reduce the length of your mortgage and save you thousands of dollars over the course of your loan: Make extra payments that apply toward the loan principal. Borrowers can pay more on principal in many different ways. For many people,Perhaps the easiest way to organize this process is by making 1 extra mortgage payment every year. If you can't afford to pay an additional whole payment in one month, you can divide your 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 result is you make one extra monthly payment each year. These options differ slightly in lowering the final payback amount and reducing payback length, but they will all significantly reduce the duration of your mortgage and lower the total interest paid over the duration of the loan.

Additional One-time payment

It may not be possible for you to pay more every month or even every year. Keep in mind that most mortgage contracts will permit you to make additional payments to your principal at any point during repayment. Any time you get some unexpected money, you can use this rule to pay a one-time additional payment on your mortgage principal.

For example: five years after buying your home, you get a huge tax refund,a very large inheritance, or a non-taxable cash gift; , paying a few thousand dollars into your mortgage principal will significantly reduce the period of your loan and save a huge amount on mortgage interest paid over the life of the loan. For most loans, even a modest amount, paid early in the mortgage, could offer huge savings in interest and in the duration of the loan.

Hawk Mortgage Group can walk you the mortgage process. Give us a call: (443) 619-7900.

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