Here's a simple trick to reduce the repayment period of your mortgage and save you thousands over the course of your loan: Make additional payments that are applied to your loan principal. You can pay against principal in many different ways. For many people,Perhaps the simplest way to keep track is by making 1 extra payment per year. If you can't pay an additional whole payment in one month, you can divide your payment by 12 and write a check for that additional amount monthly. Another option is to pay half of your payment every other week. The effect here is that you make one extra monthly payment in a year. Each of these options produces different results, but each will significantly shorten the length of your mortgage and lower your total interest paid.
It may not be possible for you to pay more every month or even every year. But it's important to note that most mortgage contracts allow you to make additional payments at any time. You can benefit from this provision to pay extra on your principal any time you come into extra money.
If, for example, you receive a surprise windfall just a few years into your mortgage, investing several thousand dollars into your mortgage principal can significantly reduce the duration of your loan and save enormously on mortgage interest over the duration of the mortgage loan. Unless the mortgage loan is quite large, even a few thousand dollars applied early in the loan period can yield huge savings over the life of the loan.
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