- Throw extra money at it every month. Even a LITTLE extra money can mean the difference of a few years. Here’s a couple of ideas; Round your payment up. Is your monthly mortgage $934? Then round it up to $940. OR Simply add a fixed amount to your payment each month. Can you handle paying an additional $10, $20, $30 each month?
- Make bi-weekly payments. Many banks even offer this as a repayment option. Make half your monthly payment every other week. At the end of the year, this adds up to 13 payments. That’s one extra payment every year! Whatever you do, DON’T pay a third party to set this up for you. There’s no reason to pay someone else to set up a system you can do on your own if your bank doesn’t offer it.
- Apply your tax refund (if you get one), or even just 25% of it, to your home mortgage payment every year.
- If possible, pay any and all closing fees up front. Don’t roll them into your home mortgage. Why pay interest on fees anyway?
- Make a hard and fast rule to apply any unexpected income toward your home mortgage. Were you the recent recipient of an unexpected inheritance? Apply 10% of it toward your home mortgage.
Be sure to check with your bank to make sure there are no pre-payment penalties and take care to SPECIFY extra payments to principal.
Have some tips of your own? Please share!
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