Mortgage Saving Tips

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There's a simple trick to reduce the repayment period of your mortgage and save thousands over the course of your loan: Make extra payments which go toward your principal. Borrowers can do this in several ways. Making a single extra full payment one time per year is probably the easiest to keep track of. If you can't afford to pay an extra whole payment in one month, you can divide that payment by 12 and write a check for that additional amount monthly. Another very popular option is to pay a half payment every two weeks. The result is you will make one additional monthly payment each year. These options differ slightly in reducing the final payback amount and reducing payback length, but they will all significantly reduce the duration of your mortgage and lower the total interest paid over the duration of the loan.

Lump-sum Additional Payment

It may not be possible for you to pay more every month or even every year. Remember that almost all mortgages will allow you to pay extra on your principal at any time. Whenever you get some extra money, you can use this provision to make an additional one-time payment toward principal.

Here's an example: a few years after buying your home, you receive a very large tax refund,a very large legacy, or a cash gift; , investing several thousand dollars into your mortgage principal will significantly reduce the period of your loan and save enormously on mortgage interest paid over the duration of the loan. Unless the loan is very large, even small amounts applied early can yield huge savings over the life of the loan.

Paragon Mortgage Services, Inc. can walk you Paragon Mortgage Services, Inc. has your mortgage answers. Call us: 303.727.2466.