Making consistent additional payments on your principal balance will provide enormous returns. People pay extra in a few ways. Making a single additional payment one time every year is perhaps the simplest to arrange. But many people can't pull off such an enormous additional expense, so dividing one additional payment into 12 additional monthly payments is a great option too. Another option is to pay a half payment every other week. The result is you make one additional monthly payment in a year. Each option produces different results, but they will all significantly shorten the length of your mortgage and lower your total interest paid.
It may not be possible for you to pay down your principal every month or even every year. Remember that almost all mortgages will allow you to make additional payments to your principal at any point during repayment. You can benefit from this rule to pay down your principal any time you get some extra money.
If, for example, you were to receive a large gift or tax refund five years into your mortgage, paying a few thousand dollars into your mortgage principal will reduce the period of your loan and save enormously on interest over the life of the mortgage loan. For most loans, even a small amount, paid early enough in the mortgage, could offer big savings in interest and length of the loan.
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