There's a trick to significantly reduce the length of your mortgage and save thousands over the course of your loan: Make extra payments that go toward your loan principal. Borrowers employ various techniques to meet this goal. Making a single additional full payment once per year is likely the easiest to arrange. 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. Finally, you can commit to paying a half payment every other week. Each of these options yields slightly different results, but each will significantly shorten the duration of your mortgage and lower the total interest you will pay over the life of the loan.
Some people just can't make extra payments. Remember that almost all mortgage contracts will permit you to pay extra on your principal at any point during repayment. Whenever you come into unexpected money, you can use this provision to make a one-time additional payment toward your mortgage principal.
If, for example, you were to receive a very large gift or tax refund four years into your mortgage, paying several thousand dollars into your home's principal can shorten the repayment period of your loan and save a huge amount on interest over the duration of the loan. Unless the loan is quite large, even a few thousand dollars applied early in the loan period can yield huge benefits over the duration of the loan.
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