For those people who want pay back on your mortgage as soon as possible, you may want to consider making extra mortgage payments. Some people will not dabble with it in case it has a negative impact, somehow, on them. Be sure to speak with someone reputable in regards to paying it back early if that is something you wish to do.
To begin with, you can just add a nominal additional amount as extra payment toward the principal. It can be as small as ten dollars. Over the course of your loan, depending on the interest rate and other facts, you could save a substantial amount of money. It is imperative that your loan servicer knows that these extra payments are to go toward the outstanding principal.
It is beneficial for you to make extra mortgage payments early on in your loan. This helps to lower interest in future months. The reason for this is that in the beginning of your loan, the payments are “interest-heavy.”
You could also save money, in the long run, if you make a significant single extra mortgage payment. Again, it is most beneficial if you make a large additional payment early on in your loan. You could also make just one extra mortgage payment every year. Some people will do this after receiving an unexpected bonus from work or after they receive their tax refund.
No matter which method you decide to use to make extra mortgage payments, we cannot stress enough that it is necessary to be sure the loan servicer is well aware that what the money is suppose to go toward. Also be sure you will not be penalized in any way for the extra payment.