Curious How To Pay Off Your Loan Faster?
You probably remember growing up in one house and possibly living there your whole life? You would probably visit family friends, relatives and other acquaintances, and they lived in the same houses most of their lives as well, right? That was a common things years ago. People would buy a house and stay in that home for years, or sometimes their whole life. Homeowners would work over the years to make the payments and then celebrate at the end of the 30 years of making mortgages payments because they had met that great milestone and paid their home off.
Things are different today. Most homebuyers don’t buy a home with the intent of living in the home their entire life. As a matter of fact, many people will sell their home within the first 7 years of living in it. Paying off a 30 year mortgage can seem like an impossible task when you keep starting over. Luckily, there are ways that you can pay off your loan faster.
Follow These Tips To Pay Off Your Loan Faster:
- Biweekly Payments– You can discuss this with your lender so that you can determine how they handle biweekly payments. If you start this process immediately, you can cut 8 years off of your mortgage on a 30 year loan.
- Extra Payments– You apply extra payments every month, however by making just one extra payment each year, you can pay off your loan 11 years earlier (or sooner, depending on the amount of extra payment being made).
- Refinance to 15 Years– You can take advantage of low interest rates and refinance your mortgage to a 15 year loan. Your payment may increase a bit, but you will have your mortgage paid off 15 years faster than you would if you stuck with a 30 year mortgage.
- Principal Reduction– Adding to your monthly payment a little at a time can definitely pay off! When possible, increase the principal amount you are making on your loan. This will help pay down the mortgage faster as your regular payment is for principal and interest.
Once your mortgage is paid off you will be free to do more with your money. Paying off your mortgage builds wealth and financial independence or freedom. When you make paying off your mortgage a priority and think of it as more of a life goal, you can find great satisfaction in watching the amount owed go down. This can add to huge savings in interest, which can be used for better investments in the future.
Dana Rodriguez says
We live in a rental but hope to purchase a home soon. These are great tips!
Sherry Proch says
This should be read by all newly weds and 20 something!
Heidi Gagliardi says
Great information for home owners! Thank you.
Dana Matthews says
I completely agree. By doubling up on our payments, our home was paid of early. And love that you said, “Get started”!
Rosie says
This is good. We were able to pay off a mortgage earlier than the total time. We didn’t mind sacrificing now and then to put those extra payments in, and getting that mortgage release was a good reason to celebrate! It still costs a lot with repairs, mechanicals, taxes, etc., it still isn’t cheap, but having that mortgage done ‘n paid feels darn good.
Calvin says
Great tips, very often it’s wise to learn about the variable mortgage rates vs fixed, etc. Do research!