How To Pay Off Mortgage Faster
Many homeowners would like to know how to pay off their mortgage faster, but never take the necessary steps to actually do it because they believe it will be too hard. The fact is that paying off your mortgage faster does not have to be difficult. You simply have to use these simple steps to do it.
- Refinance to get the length of your loan shortened. It is much easier to pay off your mortgage faster when you have a shorter term on your loan. So, see if you can refinance to a fifteen-year mortgage so you can pay off your mortgage in less than half the usual time.
- Make your mortgage payments every two weeks instead of once of month. Simply divide your monthly payment by two and send that amount in once every two weeks. By sending in a payment biweekly you will be decreasing your principle balance faster, which will cut the amount of interest you pay.
- Put extra money toward your principle balance every month. Look at your budget and find a little extra money to put toward your mortgage. Even finding as little as $50 extra every month can make a huge difference and help you pay off your mortgage faster. So cut out a night of eating out or work a few extra hours a month so you can put that money toward your home loan. Remember, you will not only be reducing your principle balance, but also the amount of interest you will be paying over the life of your loan.
- Use unexpected extra money toward your mortgage. Apply any windfalls toward your mortgage balance. Whenever you get a raise, bonus or large tax return, apply that money toward the principle on your loan. You did not use that money before, so you will never miss it.
- Keep up your hard work until you have paid off your mortgage. Continue to follow these steps until your loan has been paid off early. By making biweekly payments, finding extra money to put toward your mortgage and using windfalls to pay off your mortgage, you will likely pay off your mortgage years earlier than you expected. So keep up your hard work and you will reap the financial rewards.