{"id":1246,"date":"2024-02-12T14:51:27","date_gmt":"2024-02-12T14:51:27","guid":{"rendered":"https:\/\/www.mikeclover.com\/blog\/?p=1246"},"modified":"2024-02-12T14:52:32","modified_gmt":"2024-02-12T14:52:32","slug":"simple-ways-to-pay-off-your-mortgage-sooner","status":"publish","type":"post","link":"https:\/\/www.mikeclover.com\/blog\/2024\/02\/12\/simple-ways-to-pay-off-your-mortgage-sooner\/","title":{"rendered":"Simple ways to pay off your mortgage sooner<\/strong>"},"content":{"rendered":"\n
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If you\u2019ve decided that you want to remain in your home for the long term, then you\u2019d probably love to pay it off long before the 30 years \u2013 or 15 or 20 if you opted for a shorter term.<\/p>\n\n\n\n

Unless you had cash with which to buy your home, you know you\u2019ll be paying a house payment no matter what. It will either be for your house or for a house belonging to your landlord. But when you think about all the interest you\u2019ll pay over the life of the loan, it\u2019s still painful!<\/p>\n\n\n\n

Paying your loan off early means paying less interest, so consider these options:<\/p>\n\n\n\n

Add a few extra dollars to each payment.<\/strong> I have a friend who shortened her car loan by about 5 months simply by adding $3.24 to each payment. She rounded the payment from $271.76 to $275. That was painless.<\/p>\n\n\n\n

If she\u2019d added $13.24 the term would have been even shorter.<\/p>\n\n\n\n

However, if you can afford it\u2026<\/strong><\/p>\n\n\n\n

Add an extra payment to each payment.<\/strong> And no, I don\u2019t mean make double payment. Just double the amount of the payment that is going toward the principal. Here\u2019s an example:<\/p>\n\n\n\n

An actual home loan with an interest rate of 3.625% carries payments of $1,632.53 per month. Since the loan is only a few years old, the amount going to the principal each month is only $427.09. That means paying $2,059.62 is equal to paying two payments. A payment of $2,486.71 would effectively make 3 payments.<\/p>\n\n\n\n

As time goes by, you\u2019d have to increase that amount, because more of each payment will go to principal as less goes to interest. But you\u2019d still reap the benefit of shaving a few interest-bearing months off your loan early on.<\/p>\n\n\n\n

The beauty of these methods is that you can do it when you can afford it, and not do it if you need the money for car repairs instead.<\/p>\n\n\n\n

Make one extra payment a year. <\/strong>If you receive a Christmas bonus or get a tax refund each year, consider putting that money toward an extra payment on your loan. In the example above, that one extra payment added to your regular payment would be equal to making 3 extra payments.<\/p>\n\n\n\n

Create your own amortization schedule.<\/strong><\/p>\n\n\n\n

If you\u2019d like a bit more structure, first decide how soon you want to pay off that mortgage. Then go on line to find an amortization schedule and plug in your numbers. You\u2019ll learn what your new payment would need to be (minus the taxes and insurance) to pay off the loan in that amount of time.<\/p>\n\n\n\n

Do Note:<\/strong><\/p>\n\n\n\n

With any of these methods, be sure to fill out your payment coupon or screen correctly. When you pay extra money, designate it to go to the principal of your loan.<\/p>\n\n\n\n

Refinance to a shorter term loan.<\/strong><\/p>\n\n\n\n

While this method might lock you in to a higher payment each month, it has advantages.<\/p>\n\n\n\n

I say \u201cmight\u201d because one of the advantages is that if you have an FHA loan and now have 20% equity, your refinance to a conventional loan will remove your mortgage insurance premiums.<\/p>\n\n\n\n

Second, since shorter term loans generally carry lower interest rates, you may be able to refinance at a lower rate.<\/p>\n\n\n\n

Refinancing does come with costs, so talk it over with your mortgage broker and get all the facts before making a decision.<\/p>\n\n\n\n

Before you make a decision on paying your mortgage loan off early\u2026<\/strong><\/p>\n\n\n\n

Consider the rest of your financial situation. Would those extra dollars be better spent somewhere else? For instance, if you have credit card debt, or any other higher interest loans, they should be paid off first.<\/p>\n\n\n\n

Are you saving for retirement or for your children\u2019s educations? Do you have some money set aside for emergencies \u2013 or opportunities?<\/p>\n\n\n\n

Would you like to talk it over with a professional?<\/strong><\/p>\n\n\n\n

Then call us today at Homewood Mortgage, the Mike Clover Group<\/strong>. We\u2019ll be glad to show you the facts and figures regarding a refinance \u2013 or to help you cerate your own new amortization schedule.<\/p>\n\n\n\n

We offer fast, friendly service, combined with some of the lowest rates and best terms available anywhere in Texas.<\/p>\n\n\n\n

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Call us today at 800-223-7409<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

If you\u2019ve decided that you want to remain in your home for the long term, then you\u2019d probably love to pay it off long before the 30 years \u2013 or 15 or 20 if you opted for a shorter term. … Continue reading →<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[1],"tags":[],"_links":{"self":[{"href":"https:\/\/www.mikeclover.com\/blog\/wp-json\/wp\/v2\/posts\/1246"}],"collection":[{"href":"https:\/\/www.mikeclover.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.mikeclover.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.mikeclover.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.mikeclover.com\/blog\/wp-json\/wp\/v2\/comments?post=1246"}],"version-history":[{"count":2,"href":"https:\/\/www.mikeclover.com\/blog\/wp-json\/wp\/v2\/posts\/1246\/revisions"}],"predecessor-version":[{"id":1248,"href":"https:\/\/www.mikeclover.com\/blog\/wp-json\/wp\/v2\/posts\/1246\/revisions\/1248"}],"wp:attachment":[{"href":"https:\/\/www.mikeclover.com\/blog\/wp-json\/wp\/v2\/media?parent=1246"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.mikeclover.com\/blog\/wp-json\/wp\/v2\/categories?post=1246"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.mikeclover.com\/blog\/wp-json\/wp\/v2\/tags?post=1246"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}