Pay Your Mortgage Down Fast: Top 3 Tips

For most people, a mortgage is the biggest financial burden they have.

It can be very tempting to pay down that mortgage faster. The thought of having your home bought and paid for and 100% your own before that 25- or 30-year term is up can sound like an impossible dream, but the truth is that you can pay your mortgage off more quickly simply by tweaking your regular financial habits.

Your 3 Tips to Pay Off Your Mortgage Faster courtesy of the best Concord agent and best Charlotte agent, Leigh Brown:

1. Round up your payments. If your monthly mortgage payment is $945, round that number up to an even $1000 and pay that to the bank each month. You’ll barely notice the difference in your bank account, but you’ll be amazed at how a few extra dollars every month adds up to major savings over time, especially on the interest portion of your payments.

2. Pay more often. Although not all mortgagors offer this service, check and see if it’s possible to switch to a weekly or bi-weekly payment schedule versus a monthly schedule. You will still pay the same amount in total every month, but because you are making smaller payments more frequently, your principal will decline slightly with each payment and then there will be less interest accrued on subsequent payments than if you were paying only once a month.

3. Refinance for a better rate. If you have a mortgage rate that is a relic of days gone by when interest rates were much higher, you are probably paying way more than necessary in interest each and every time you make a mortgage payment. Get on the phone right away and talk to your mortgagor about the pros and cons of refinancing your mortgage. If you qualify for a lower rate, you could save yourself a significant amount of money over time.

The reason that mortgages take so long to pay off is because of the interest you owe the bank for lending you the money to buy your home in the first place. If you can find ways to either reduce your interest rate or pare down your balance so there is less principal on which interest can accrue, you will be doing yourself a huge favor and your will be living mortgage-free before you know it.