(Newswire.net — September 27, 2017) — Everyone eventually wants to own a home, but no one wants to remain in a six-figure debt for very long. While the truth is that it would take considerable funds to acquire a home without a mortgage, homeowners have a good amount of control when it comes to determining how soon their mortgage amount is paid off.
Here are a few insights on how to pay it before it’s due.
Make Bi-Weekly Payments
Simply changing one’s mortgage payment structure can end up paying dividends at the end of the year.
Monthly payments are standard for mortgage plans, though homeowners can ask their holders to divide the monthly amount in half, tending to it in two separate payments. While this might not seem like it changes much, keep in mind that this increases your yearly payment amount.
As David Israelson from The Globe and Mail points out, “The reason is that there are 13 four-week payment periods in a year, as opposed to 12 months, allowing two extra biweekly payments.”
Make Additional Lump-Sum Payments
It would greatly benefit homeowners in the long run to invest any extra money into their mortgage payment. Small additional amounts that can be added to the sum – even amounts in the single or double digits – can result in a considerable amount of time removed from mortgage payment obligations.
Ultimately, every dollar saved by the homeowner counts. You should try and implement every means of saving that you can, whether through mindful shopping, or using services such as IntelliQuote to help you cut insurance costs. Put all of these savings towards your mortgage and you’ll thank yourself later down the line.
Additionally, a good way to start adding lump-sum payments to your mortgage is by simply rounding payments off to the nearest thousand. For instance, if a homeowner has $177,445 left on their mortgage, they can make a payment of $445 to reduce the amount to $177,000. For many, seeing a round rate is motivating.
It’s likely that your mortgage allows you the opportunity to make a number of additional payments per year, at varying percentages. Confirming the provisions behind these additional payments is important before taking on a new mortgage agreement.
Choose The Highest Paying Plan You Can
Trevor and Rebecca Mackenzie are a Canadian couple who paid their mortgage off in only five short years. Their methods were nothing particularly new – they just kept things simple, and moved as much of their earnings as they could into their mortgage payment.
“Once I moved in, we decided to accelerate the payments and find out the maximum amount we could put to the mortgage per month, and sat down to see if it was feasible,” explains Trevor. “Both of us went through university paying our way, and being debt-free was always kind of a goal.”
Despite the happiness a home provides, it isn’t uncommon for homeowners to feel dragged down by the weight of their mortgage payments. Thankfully, by making a few smart choices, that considerable mortgage amount can become a thing of the past sooner rather than later.