It seems as though everyone these days is giving advice on the benefits of paying off your mortgage early. Some of the advice is great, but many articles posted on the internet on this topic neglect to mention that it may not be economically feasible for homeowners to pay more than their regular mortgage payment every month. Many homeowners live on limited budgets, and the thought of sending extra money to their mortgage company at the end of each month can seem like an impossible notion.
If you are not interested in paying off your mortgage early, that’s ok. But if you think that owning your house outright before the term of your mortgage expires, there are plenty of small steps you can take to make it happen. Paying your mortgage in full is not something that will happen overnight unless you win the lottery or suddenly come into a lot of money all at once. But paying down your mortgage can be done with minimal effort over the course of time. All it takes is effort and dedication.
Following are tips on how you can chip away at your mortgage balance little by little:
- Every time you make a mortgage payment, add a few dollars extra to the payment, and designate it to go towards the principal balance.
- Refinance your mortgage to a lower interest rate loan, but keep paying the same amount that you paid with the higher rate.
- Refinance to a 15 or 20-year mortgage, which may reduce your interest rate, while at the same time require you to pay off your loan faster.
- Make your mortgage payment every two weeks instead of once a month. This adds two extra payments into your yearly payment schedule and results in your loan being paid off faster.
- If you receive a bonus at work, send it directly to your mortgage company and have it applied to your principal.
There are dozens of other tips and tricks on how to pay your mortgage off early. Nobody is saying that you must pay your 30-year mortgage off in 5 years. But having a 30-year mortgage paid in full 10 years early is a fantastic feat! Many people aspire to be mortgage-free, and with just a small amount of effort, you can pay your mortgage off well before it was originally supposed to end.