There's a trick to reduce the repayment period of your mortgage and save you thousands in interest: Make additional payments that apply toward the loan principal. You pay against principal in various ways. For many people,Perhaps the simplest way to keep track is to make one additional mortgage payment per year. If you can't pay an additional whole payment in one month, you can split that large amount into 12 smaller payments and pay that additional amount monthly. Finally, you can commit to paying half of your mortgage payment every other week. Each of these options produces different results, but they will all significantly reduce the length of your mortgage and lower your total interest paid.
Some people can't manage extra payments. But remember that most mortgage contracts allow you to make additional principal payments at any time. You can take advantage of this provision to pay down your principal any time you come into extra money.
If, for example, you were to receive an unexpected windfall three years into your mortgage, you could apply this money toward your loan principal, resulting in significant savings and a shorter payback period. For most loans, even a relatively small amount, paid early enough in the loan period, could offer big savings in interest and duration of the loan.
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