What happens if I pay more than my minimum mortgage payment?

What happens if I pay more than my minimum mortgage payment?

Mortgage Payment Paying more than your minimum mortgage payment is a practice that can save you big bucks down the road. Each time you overpay, you reduce the total amount of interest you will accrue over the life of the loan as well as shortening its term.

How can I pay more than the principle of a mortgage?

By far the easiest method for paying larger amounts toward the principle of a mortgage is to save any additional funds through the month and use it as an extra payment. After the payment is made, any other additional funds could be applied to the payment as well.

Do extra mortgage payments lower your monthly payment?

Two benefits of making extra mortgage payments As you may know, making extra payments on your mortgage does NOT lower your monthly payment. Additional payments to the principal just help to shorten the length of the loan (since your payment is fixed).

How many extra mortgage payments should you make a year?

It could be one extra mortgage payment a year, two extra mortgage payments a year, or an extra payment every few months. Whatever the frequency, your future self will thank you. Maintain these additional payments over an extended period of time and you’ll likely eliminate several years from your term.