Mortgage Saving

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Making regular extra payments on the loan principal can yield enormous savings. Borrowers can accomplish this in various ways. For many people,Perhaps the easiest way to organize this process is to make one extra payment every year. If you can't afford to pay an extra whole payment all at once, you can divide that payment by 12 and pay that additional amount monthly. Another option is to pay a half payment every two weeks. The effect here is that you will make one extra monthly payment every year. Each of these options produces slightly different results, but they will all significantly shorten the duration of your mortgage and lower your total interest paid.

Lump-sum Additional Payment

It may not be possible for you to pay more every month or even every year. But you should remember that most mortgages will allow additional payments at any time. You can take advantage of this provision to pay extra on your principal any time you come into extra money. If, for example, you were to receive a large gift or tax refund just a few years into your mortgage, paying several thousand dollars into your home's principal can reduce the duration of your loan and save a huge amount on interest paid over the life of the mortgage loan. For most loans, even a small amount, paid early in the mortgage, could offer big savings in interest and duration of the loan.

CU Mortgage Division can walk you CU Mortgage Division has your mortgage answers. Give us a call at 360-539-4687.