Making regular additional payments on your loan principal will provide enormous returns. People use different methods to meet this goal. For many people,Perhaps the easiest way to organize this process is to make 1 extra payment a year. But many folks will not be able to pull off this huge extra expense, so dividing one extra payment into 12 additional monthly payments works as well. Finally, you can commit to paying a half payment every other week. Each option yields slightly different results, but they will all significantly shorten the length of your mortgage and lower the total interest paid over the duration of the loan.
One-time Additional Payment
Some people just can't make any extra payments. But you should remember that most mortgage contracts will allow additional payments at any time. You can take advantage of this provision to pay down your principal when you come into extra money. For example: a few years after moving into your home, you get a huge tax refund,a large inheritance, or a non-taxable cash gift; , you could apply a portion of this windfall toward your mortgage loan principal, resulting in huge savings and a shorter loan period. For most loans, even a relatively modest amount, paid early enough in the loan period, could offer huge savings in interest and duration of the loan.
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