You’ve been successfully paying your mortgage, and you still have enough money at the end of the day. Congratulations, you’re one of the many who did the right steps before you started paying for your home.
If you can afford it, we always suggest that you try to pay your home loan earlier as soon as possible. You can expect to save a lot of money. Also, you will find that doing it amidst the caveats is worth the effort.
Make a Small Percentage Add-On
There are different ways to successfully pay your housing loans faster. If you can, make a small percentage add-on to your fees as this can reduce the interest payments you’ll do in the long run.
As an example, let’s say you pay an additional 1/12 of the entire monthly fees on top of the minimum. If you do this, you get to pay 13 months in a year. It may sound insignificant now, but if you pay that much additional now for a $200,000 mortgage fee at 4.5%, you could save as much as $18,000 and finish it a little bit over 3 years earlier.
Before you start paying more, we suggest checking with your financing agent on what you can do to pay faster and have your fees calculated correctly. There may be some small fees that need to be done.
Request a Refinancing
If you have a good chunk of extra money, it’s best to request a 10 to 15-year refinancing. This is important because this allows flexibility to reduce the interest rates to a lesser amount, up to around 1% reduction of the annual interest.
Remember, however, that refinancing is neither a quick process nor is it free. You’re asking a financial institution to lose money in the long run, on the promise that you’ll pay more. It will take some time for them to reassess your plan and even then, you’re paying more money.
Give Some of Your Extra Money
The last way you can pay your mortgage payments faster is to put some extra money you have now and then. Be it a bonus, extra-wage, tax refunds, tax cuts or something extra you got, put some of it into the housing loan’s payments. Pay extra when you have extra, it helps in the long run. Contact mortgage comparison for more information.