Making regular additional payments on your loan principal will provide enormous savings. Borrowers can pay more on principal in many different ways. For many people,Perhaps the simplest way to keep track is to make 1 extra payment every year. However, many people can't pull off this huge extra expense, so dividing one extra payment into 12 extra monthly payments works too. Another very popular option is to pay half of your payment every two weeks. The effect here is that you will make one extra monthly payment every year. Each of these options produces slightly different results, but they will all significantly shorten the length of your mortgage and lower the total interest you will pay over the duration of the loan.
Some borrowers just can't make extra payments. Remember that almost all mortgages will permit you to make additional payments to your principal at any time. You can benefit from this rule to pay extra on your principal when you get some extra money. If, for example, you receive a large gift or tax refund three years into your mortgage, paying a few thousand dollars into your home's principal can significantly shorten the repayment duration of your loan and save a huge amount on interest over the duration of the loan. Unless the mortgage loan is very large, even a few thousand dollars applied early in the loan period can yield huge benefits over the life of the loan.
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