I have done all of these and it was great to pay off our house that soon. Why give the banks all that money in interest if you don’t have to. If I can do it anyone can. Once you set it up you don’t realize how fast it goes by. Do it today!! Don’t wait.
Note: Many banks, because they are structured to process payments monthly, will not be able to accommodate the bi-weekly payment schedule. However, a diligent borrower can do this on his own by multiplying whatever he is paying now by 1.083 (or ) in order to pay the equivalent of 13 payments a year.
Hey Nicole, Fortunately, we have no mortgage, but really enjoyed the article. You are one smart cookie. I’m passing the site on to Judy, and maybe it’ll help her. We love you—
It sounds like you are in quite a difficult situation. As you pointed out the numbers you are working with are impossible to balance. Your house is too much of your income. I wouldn’t think about paying off the house early. Keeping up with the payments is enough in itself. I think you and your husband will need to decide what should go – music, house, or phones. Either that or increase the income. Unfortunately, there is not something you are missing financially. The facts are clear, the option now is what to cut from the budget. I’m so sorry to hear about your situation.
So am I understanding this correctly. If I decide to make a yearly principle payment once a year, every year, at the begining of the year, I can possibly knock off 6yrs every year I make a payment? example: 2010-(1) yearly principle payment=6yrs 2011-(1) yearly principle payment=6yrs 2012-(1) yearly principle payment=6yrs…. Using the above example I’ve reduced my 30yr mortgage by 18yrs. Is this what you’re saying?
Paying mortgage off early is definitely not for the faint-hearted. It makes a huge sense to do it only if you have reasonable cash stashed away, you do not carry interest -bearing balance on a credit card and you do not plan to take out a loan soon. I will put out a more detailed blog post about this soon. Thank you for this your blog, “Am Loooooving it”. You have inspired me and I am aspiring to be like you some day soon with my blog too. God Bless You
“Why give the bank an extra $250 today where a cup of coffee will be worth $250 in 30 years” ? In other words, the value of the dollar is worth more today than in 30 years. So use the dollar now and invest it, or put it aside for a rainy day than give it to the bank!
I live in California. Bought my house for $333k and I plan to live here for quite a while. Our extra $12/month has taken months off our loan. The more you put the faster you’ll pay it off. Just use the ideas listed in this article. Or make the 2 or 3 extra payments a year. Anything will help. And always look to refi to get lower rates, but only if it doesn’t set you back a lot of money due to closing costs, etc.
Thanks so much. These are wonderful advice! I will work that into my budget and income sheet. I can’t wait to pay it off! We are currently debt free as well. Our car is paid off too. Heating and everything here is not too bad. I pay a month for lighting and gas is about a month. Pretty decent compare to other places.
We just bought our first house. We have a high interest rate, for two reasons: a) we have bad credit b) we owner financed (because of the credit). We can pay off early without penalty, and want to do so. I am wondering how to determine how much extra to pay each month so we can pay the house off in half the time, which would be 2 1/2 years.
However, it is feasible for them to take extra money received from and income tax check and apply it to the mortgage
While this sounds very enticing, the amounts of money spent on refinancing fees and costs I would think would be a huge waste (especially only to gain barely 4/10 % in interest rate the first time). That money could have been put against the principal (more than once, as I see refnancing seems to be rather the norm for Gerry). You can pay off your mortgage in 15 years without going through all this hassle and fees with just very good payment application habits.
We have a $63000 loan, with 5 yr term
Hello-How to pay off your mortgage early- 5 pain free tips for paying off your mortgage early Reading the information that you’ve posted I have a question on step number two changing your W-4 to get less refund so you can increase your monthly mortgage payment. Now, I question as is this really reasonable? Most Americans today cannot afford to make extra payments on their mortgages. I understand the savings is not as much however when suggesting that people have more allowance’s deducted from their paychecks isn’t it possible that people would tend to have too many allowances taken out and this would cause them to actually owe money on their taxes and defeat the entire purpose? Now, I do think that you have provided some great ideas overall and I believe that if anyone can pay biweekly that is a great incentive to paying off early. I will try and use these suggestions and get my mortgage paid off early but, I think the best one for me personally will be the pay increases and putting the extra money toward the mortgage.