There are a few easy ways to make extra principle payments that can save you a ton of money in interest expenses and get you mortgage-free sooner than you thought possible.
Here are a few simple strategies you can use:
1. ROUND YOUR MONTHLY PAYMENT UP
The results of this simple strategy can save you a fortune and drastically reduce the length of your mortgage.
As an example, if your monthly mortgage payments were $734 dollars a month, but you rounded it up to $800 per month, you would save more than $48,000 in interest payments, and reduce the length of your mortgage by 7.5 years!
2. MAKE ONE-TIME PRE-PAYMENTS USING YOUR INCOME TAX REFUND
This is an easy way to save money and shorten your mortgage. For example, if you have a $100,000 mortgage, and you have a $1000 tax refund this year, you take apply that refund to your mortgage. Over time, this will save you more than $8600 and shave 1 year and 1 month off your mortgage!
That’s another amazing result from a simple strategy.
3. CHOOSE A 15-YEAR MORTGAGE
If you can afford it, you are far better off getting a 15-year mortgage instead of 30. It won’t cost you much more, and the interest savings are truly incredible.
If you have a mortgage of $100,000 at 8% interest over 15 years, your monthly payment would be about $200 more, but you’d save $92,083 in interest over the life of your mortgage!
Using these strategies is the easiest way to reduce your interest expenses and shorten your mortgage period.
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