Making regular extra payments on the loan principal provides big savings. People accomplish this goal in a few ways. Making one extra full payment once a year may be the easiest to arrange. If you can't afford to pay an extra whole payment in one month, you can divide your payment by 12 and write a check for that additional amount monthly. Finally, you can commit to paying half of your mortgage payment every other week. Each option yields slightly different results, but each will significantly reduce the length 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. But remember that most mortgages will allow you to make additional payments at any time. You can benefit from this rule to pay extra on your principal when you get some extra money.
For example: several years after buying your home, you receive a huge tax refund,a large legacy, or a non-taxable cash gift; , you could pay this money toward your mortgage loan principal, resulting in enormous savings and a shorter loan period. Unless the mortgage loan is quite large, even small amounts applied early can yield huge savings over the duration of the loan.
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