Save on your Mortgage Loan
Paying consistent additional payments toward your loan principal can yield huge savings. People make this happen in several ways. For many people,Perhaps the easiest way to organize this process is by making 1 extra mortgage payment a year. If you can't afford to pay an additional whole payment in one month, you can split that large amount into 12 smaller payments and pay 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 additional monthly payment each year. Each of these options produces slightly different results, but they will all significantly reduce the length of your mortgage and lower your total interest paid.
Lump Sum Extra Payment
Some folks just can't make any extra payments. Keep in mind that almost all mortgages will allow you to make additional payments to your principal at any point during repayment. Whenever you get some unexpected money, you can use this rule to make an additional one-time payment on mortgage principal. If, for example, you were to receive a very large gift or tax refund five years into your mortgage, you could apply this money toward your loan principal, which would result in significant savings and a shorter payback period. For most loans, even a relatively modest amount, paid early in the loan period, could offer huge savings in interest and duration of the loan.