There are a few smart ways to save money on the repayment of your mortgage. Here are two ways to save big by putting a little extra money down on your mortgage with each mortgage payment.
Consider making accelerated bi-weekly payments.
This is where you divide your monthly payment in half, but instead of making two payments per month (24 per year), you make payments every two weeks (26 per year). This example is based on a $500,000 mortgage at 3.00% over a 25-year amortization. As you can see, the extra cost per month is minimal, but the savings are huge!
Consider making a lump sum payment.
Let’s say you have a $500,000 mortgage at 3.00% over a 5-year term (25 year amortization). You get a $15,000 bonus at work and apply it to your mortgage at the beginning of the second year.
You can try both these ways to save money on the repayment of your mortgage. For more information contact us and we can give you a better idea of how much you can save on your mortgage by implementing these acceleration strategies.