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3 Ways to Pay off Your Mortgage Early
It doesn’t need to take 30 years to pay off your mortgage. Here are a few ways to easily shorten that term.
I know that when buyers are sitting at the closing table and they see the date of their last mortgage payment in 30 years, it can be daunting and you might think you’ll never pay it off. However, here are some tips that can help you pay down that mortgage in under 30 years:
1. Switch to bi-weekly payments. By doing this, you’ll end up making 13 full payments a year instead of 12. This really adds up in the long-term. It can take off about five years from the life of your loan.
2. Make extra (principal-only) payments. In the first few years when you’re making your payments, most of that money is going towards your interest. However, if you can make principal-only payments in addition, this can decrease the amount of interest you’re paying too.
3. Refinance to a shorter term. Most mortgages are for 30 years, but you can refinance to a 15-year term. If you have a mortgage of $250,000 at 4%, this switch will save you $96,814 on your payments.
I hope these tips help you make the most out of the equity in your property. If you have any questions for me in the meantime, don’t hesitate to give me a call or send me an email. I look forward to hearing from you soon.
As a licensed real estate professional in Minnesota and Wisconsin and a nation-wide referral community. I provide much value to facilitating real estate transactions with focus in the luxury and reloc....