Cut Years off of Your Mortgage and Save Thousands in Interest

Real Estate Broker/Owner with M & M Realty of Brevard Inc. BK629999

Did you know that you can cut years off of your mortgage and save thousands? 

By making one additional principal payment each year on your 30 year fixed rate mortgage, you can cut approximately 8 years* off of the length of your loan and save tens of thousands of dollars.

Have you heard about bi weekly mortgage payments? 

These are when your mortgage payment amount is divided in half and you make the payment every 2 weeks, in effect adding one additional payment to your loan by the end of the year. Often times they cost a hefty fee to set up and the lending institution charges a monthly fee to process the payment. You can create the same effect by making an additional mortgage payment each year.**

Are you thinking that you just don't have the extra money to mail in an additional principal payment each year?

Well, try this... divide your monthly mortgage payment by 12.  Every month mail the additional 1/12 payment amount in with your monthly payment. So, if your monthly mortgage payment is $1200, $1200 divided by 12 =$100. Every month mail in $1300.  At the end of the year, you will have made an additional principal payment.

It is advisable to send the extra principal payment to your lender in a separate check.  It is important that you specify that the extra funds are to be used as a principal reduction. Check your online statement regulary to be sure this is being done.

Before starting a plan like this, be certain that your loan has no prepayment penalties.  

*This figure may vary depending on the type of your loan. 

**A true analysis can be done by using a mortgage calculator and running an amortization schedule to determine which program will provide the greatest benefit to you.  Check with your lender for additional information.


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Sandy Shores, Broker   

Melbourne FL Real Estate

Brevard County Real Estate

M & M Realty of Brevard, Inc. 

Residential, New Construction, Relocations & Investment

Brevard County FL Real Estate 19 Years

Brevard County FL Resident 39 Years 

Serving Melbourne, Palm Bay, Suntree, Viera, Rockledge, Cocoa,  Merritt Island, Titusville, Cape Canaveral, Cocoa Beach, Satellite Beach, Indian Harbour Beach, Indialantic & Melbourne Beach


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Thesa Chambers
Alpine Real Estate - Bend, OR
Principal Broker - Licensed in Oregon
this does work well for some - nice job explaining it  
May 05, 2008 10:16 PM #1
Sandy Shores Broker, Melbourne Real Estate
M & M Realty of Brevard Inc. - Melbourne, FL
Brevard County FL Real Estate

Thanks Thesa,

I find that this is one of the most powerful tools a homeowner can use. They just must be disciplined enough to stick to the plan.  

Take care! 

May 06, 2008 09:23 AM #2
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Brevard County FL Real Estate
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