When you prepay your mortgage, you make extra payments on your principal loan balance. Paying additional principal on your mortgage can save you thousands of dollars in interest and help you build equity faster. There are several ways to prepay a mortgage:
- Make an extra mortgage payment every year
- Add extra dollars to every payment
- Apply a lump sum after an inheritance or other windfall
- Recast your mortgage
- Some combination of the above
How much can I save prepaying my mortgage?
The benefit of paying additional principal on a mortgage isn’t just in reducing the monthly interest expense a tiny bit at a time.
To learn more about prepaying your mortgage and the home buying process, visit the SCOOP! Blog
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