Huge Savings on Interest: Available to Anyone with a Mortgage
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Making regular additional payments on the principal balance yields huge returns. Borrowers can accomplish this in several ways. Making 1 extra payment once per year may be the easiest to keep track of. But many people will not be able to pull off such an enormous extra expense, so splitting an additional payment into twelve extra monthly payments works as well. Another option is to pay half of your payment every other week. The effect here is that you make one extra monthly payment in a year. Each option produces different results, but they will all significantly reduce the duration of your mortgage and lower the total interest you will pay over the life of the loan.
Lump-sum Additional Payment
Some borrowers can't manage any extra payments. But remember that most mortgages will allow you to make additional principal payments at any time. Whenever you come into unexpected cash, you can use this rule to pay an additional one-time payment toward mortgage principal. If, for example, you were to receive a very large gift or tax refund three years into your mortgage, you could apply this money toward your loan principal, which would result in enormous savings and a shorter loan period. Unless the mortgage loan is quite large, even a few thousand dollars applied early in the loan period can yield huge benefits over the life of the loan.
Leatherstocking Group, Inc. can get you past the pitfalls of getting a mortgage. Call us: 607-547-5007.