If you have purchased a house then you have probably dreamed of the day you send off that final payment and the home is officially yours. Did you know that it’s possible to pay off your mortgage quicker so that you can save money on interest? LowVARates.com offered the following suggestions as to three ways that have been proven to work when it comes to paying off your mortgage more quickly.
1. Accelerate your payments. You may think it impossible to make more payments on your mortgage, but you would be surprised at what a little sacrifice will do to shrink your mortgage. If you are allowed to, then consider using your tax refund or job bonus to make a few extra payments. Just paid off a car? Great! Pretend like you haven’t and continue making a few of those would be car payments go to your mortgage. Or better yet, plan into your budget a few times a year to make an extra payment or two. By adding these extra payments, you will cut years from the time it takes to pay off your mortgage inevitably saving you thousands of dollars in interest.
2. Eliminate debt elsewhere. Budget a payment plan to pay off large amounts of debt elsewhere, like credit cards, or auto debt. Once you’ve paid those off, use the new savings to make larger payments each month on your mortgage. Since the money has already been budgeted into your finances, you aren’t really sacrificing anything, and still paying off your mortgage sooner. This is saving you money in the long run by paying off your principle faster so you don’t end up paying as much interest.
3. Refinance. You can lower your interest rate saving you money in the long run. You can also opt to keep your monthly payments the same or a little higher. With current record breaking numbers when it comes to foreclosures a lender, such as LegacyLendingGroup.com, would rather give you a lower interest rate than risk not getting paid. This will save you thousands on interest and help you pay down the principle much faster.