For many people, buying a home is the largest purchase of their lives. Looking at the balance of your mortgage could seem daunting at first, but tackled little by little, it could be paid off before the term of the loan is up. If having that high debt hanging over your head sends you straight into panic mode, Ralph DiBugnara’s three easy tips to pay off your mortgage early are just for you. If you want to play around with your specific mortgage payment, check out this free mortgage calculator Home Qualified found on a google search.
First Tip to Pay Off Your Mortgage Early: Biweekly Payments.
Instead of only paying the lump sum of your monthly mortgage payment, switch to making half of your payment every two weeks. For example, if your mortgage payment is $2000 a month, instead of paying that amount all at once pay half of it every two weeks. By doing this you will make the equivalent of one extra payment each year which will enable you to pay off a 30 year mortgage in only 22 years. You will be paying off your mortgage 8 years earlier without even feeling it!
Second Tip to Pay Off Your Mortgage Early: Round Up.
Rounding up was always discouraged in your math classes, but it can be a great tool when it comes to saving and paying off your mortgage. Let’s use the example of a $1900 mortgage payment. Instead of $1900 you round up and pay $2000 a month. By putting that extra $100 dollars more a month toward your principal, you will reduce your time to pay off your mortgage by 3 years.
Third Tip to Pay Off Your Mortgage Early: Spend Beneath Your Budget.
The first thing you should do before you buy a home is make a budget and find out how much of a home you can you can afford . By spending less than your budgeted payment, will allow you to put that budgeted payment towards the mortgage. Every dollar you put on top of your contracted payment goes right towards principle balance. while most people take obvious costs such as mortgage payments, taxes and insurance into consideration, some expenses are less obvious. To make sure you are prepared for all surprises, check out our video with the most common homeowner expenses to help you budget wisely and completely.