Paying regular extra payments toward your loan principal yields huge returns. People employ various techniques to meet this goal. Making one additional payment once a year is perhaps the easiest to arrange. If you can't pay an additional whole payment all at once, you can divide your payment by 12 and pay that additional amount monthly. Finally, you can pay a half payment every two weeks. These options differ a little in reducing the total interest paid and reducing payback length, but they will all significantly shorten the duration of your mortgage and lower the total interest you will pay over the duration of the loan.
Some folks just can't make extra payments. But you should remember that most mortgages allow you to make additional principal payments at any time. Any time you get some extra cash, you can use this rule to pay a one-time additional payment toward your mortgage principal. If, for example, you were to receive a large gift or tax refund five years into your mortgage, you could pay a portion of this money toward your mortgage loan principal, resulting in enormous savings and a shorter loan period. For most loans, even this modest amount, paid early in the loan period, could offer big savings in interest and in the duration of the loan.
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