Making consistent extra payments toward the loan principal will provide enormous returns. Borrowers use different methods to accomplish this goal. Paying a single extra payment once per year is perhaps the simplest to track. If you can't afford to pay an extra whole payment all at once, you can divide that payment by 12 and write a check for that additional amount monthly. Another option is to pay half of your payment every two weeks. The effect here is that you will make one extra monthly payment in a year. These options differ a little in reducing the total interest paid and shortening payback length, but they will all significantly reduce the duration of your mortgage and lower your total interest paid.
Some people just can't make extra payments. But it's important to note that most mortgages allow additional payments at any time. You can benefit from this provision to pay extra on your principal when you get some extra money.
If, for example, you were to receive a very large gift or tax refund four years into your mortgage, you could pay this money toward your loan principal, which would result in significant savings and a shorter loan period. For most loans, even a relatively modest amount, paid early enough in the loan period, could offer huge savings in interest and duration of the loan.
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