Welcome or Register

Mortgage Saving Tips

How to Reduce Your Mortgage

One Additional Mortgage Payment a Year

There's a simple trick to significantly reduce the length of your mortgage and save you thousands of dollars. The trick is to make one extra mortgage payment a year and apply that payment toward your loan's principal.

This is the method being used by "Bi-Weekly Mortgage Reduction Services" and "Bi-Weekly Mortgage Savings Programs". Only, when you do it yourself, you don't pay a third party unnecessary set-up costs and fees!

Example: $100,000 loan, 30-year mortgage, 6.5% fixed interest rate

Extra Mortgage Payments/ Year

Principal & Interest

Additional Monthly Payment

SAVINGS

Total Paid

# of Years

0

$632.07

0

0

$227,542.98

29.92 / 359 mos.

1

$632.07

$52.68

$29,088.02

$198,454.96

24.12 / 290 mos.

2

$632.07

$105.35

$28,399.71

$181,050.85

20.5 / 
246 mos.

3

$632.07

$158.02

$58,320.95

$169,222.03

17.92 / 215 mos.

4

$632.07

$210.69

$66,969.79

$160,573.19

15.92 / 191 mos.

5

$632.07

$263.36

$73,607.77

$153,935.21

14.34 / 172 mos.

 

One-time Payment

It may not be possible for you to increase your monthly mortgage payment. Keep in mind that most mortgages will permit you to make additional payments to your principal at anytime. Perhaps, five-years after moving into your home you receive a larger than expected tax return, or an inheritance or a non-taxable cash gift. You could apply this money toward your loan's principal, resulting in significant savings and a shorter loan period.

Example:

With a $100,000, 30-year, 6.5% fixed interest rate mortgage loan, the borrower will pay a total of $227,542.98 to pay back the loan in 30 years. That equals $127,542.98 in interest payments.

If the same borrower makes a one-time $5,000 payment the first day of year 6, he/she will pay a total of $204,710.75 and pay off the loan in 27 years (324 months). That's a savings of $22,832.23 in interest.


Joyce DeLine‚Äč
Cornerstone Real Estate

325 El Portal Shell
Beach, CA93449
Phone: 805-441-2607

 



Already registered? Login

FREE AUTOMATED EMAIL UPDATES
Sign in to take advantage of all this site has to offer. Save your favorite listings and searches – also receive email updates when listings you like come on the market for free!

*Contact Information NOT Shared*


Quick Search


view all


Any

Any

No Min.

No Max.

Contact Us







* fields are required


Joyce DeLine  |  805-441-2607  |  Email Joyce
Cornerstone Real Estate  |  2665 Shell Beach Road Suite J
Shell Beach Ca, 93449