Making consistent extra payments toward your principal will provide enormous savings. People employ various techniques to accomplish this goal. Paying one additional payment once per year is perhaps the simplest to arrange. But many people won't be able to swing this huge extra payment, so splitting one extra payment into twelve additional monthly payments is a fine option too. Another very popular option is to pay a half payment every two weeks. The effect here is that you make one additional monthly payment in a year. Each of these options produces slightly different results, but they will all significantly shorten the duration of your mortgage and lower your total interest paid.
Some folks just can't make extra payments. Keep in mind that almost all mortgage contracts will allow you to pay extra on your principal at any time. Any time you come into unexpected cash, you can use this provision to make a one-time additional payment toward mortgage principal. If, for example, you were to receive a very large gift or tax refund just a few years into your mortgage, investing a few thousand dollars into your home's principal can significantly reduce the duration of your loan and save a huge amount on mortgage interest over the duration of the loan. Unless the mortgage loan is quite large, even a few thousand dollars applied early can produce huge benefits over the duration of the loan.
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