No one wants to pay a mortgage for 25 years and 2020 is the year for you to take control of your payment options to build your home equity and save money over the life of your mortgage.
Barb Pinsent from Mortgage By Barb advises “Depending on your lender, you may have the option to make additional payments to your mortgage, but the freedom to choose when and how this happens is not always available. There are conditions most lenders apply to pre paying a mortgage. Seeking advice from a professional mortgage broker will assist you to take advantage of your mortgage terms and conditions to reduce the life of your mortgage.”
Depending on your Lender policy, here are some steps that Barb recommends to reduce your Mortgage:
- Accelerate Your Payments
Check if you can make any extra payments to your mortgage without incurring a prepayment penalty. A common method includes making the mortgage payments on an accelerated bi-weekly basis as opposed to monthly. You make half the monthly payment every two weeks. This will allow for one extra monthly payment a year. Your lender may even allow you to double up on your payments.
- Round Up your Payments
This easy solution can take years off your mortgage – simply round up your payments! Barb suggests “You can easily turn a $2155 payment into a $2200 payment with little shock to your bank account. It’s a small amount that can make a big difference.”
- Make a Lump Sum Payment
Most lenders allow you to make yearly lump sum payments to your principal balance. Try to apply your next tax refund, bonus, or raise to your mortgage payment. You can also arrange for any dividends or bond maturity payments to go into your mortgage instead of being reinvested.
Check your lenders policy and look to take advantage of what is available to you. When you need assistance with managing your mortgage, or have any mortgage questions, contact Barb Pinsent on 780.370.1490.