Paying consistent extra payments toward the loan principal can yield huge returns. People use different methods to accomplish this goal. For many people,Perhaps the easiest way to keep track is by making 1 extra payment every year. 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. Another popular option is to pay half of your payment every other week. The result is you make one extra monthly payment each year. Each of these options yields slightly different results, but they will all significantly reduce the length of your mortgage and lower the total interest paid over the duration of the loan.
Some people can't manage extra payments. But you should remember that most mortgages will allow additional payments at any time. You can benefit from this provision to pay extra on your principal any time you come into extra money.
If, for example, you receive an unexpected windfall three years into your mortgage, you could apply a portion of this money toward your mortgage loan principal, resulting in enormous savings and a shortened loan period. For most loans, even a relatively small amount, paid early in the loan period, could offer big savings in interest and length of the loan.
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