There's a trick to significantly reduce the length of your mortgage and save thousands over the course of your loan: Make additional payments which are applied to the loan principal. People make this happen in several different ways. Making one additional full payment one time per year is probably the simplest to track. If you can't pay an extra whole payment all at once, you can divide your payment by 12 and pay that additional amount monthly. Another very popular option is to pay half of your payment every two weeks. The result is you make one additional monthly payment every year. Each option yields different results, but they will all significantly shorten the duration of your mortgage and lower your total interest paid.
It may not be possible for you to pay extra every month or even every year. But you should remember that most mortgage contracts allow additional payments at any time. You can benefit from this rule to pay down your mortgage principal when you get some extra money. Here's an example: several years after buying your home, you receive a huge tax refund,a very large inheritance, or a non-taxable cash gift; , investing a few thousand dollars into your home's principal can shorten the repayment duration of your loan and save a huge amount on interest paid over the life of the mortgage loan. Unless the loan is quite large, even a few thousand dollars applied early in the loan period can yield huge savings over the duration of the loan.
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