How to shorten the length of your mortgage and minimize the cost of borrowing.
There are many benefits to shortening your mortgage, and thereby paying less for the cost of borrowing the money. You can free up money for other things in your life – the education of your children, money for your retirement or an emergency fund.
- Make more payments. Increase the frequency of your payments. Ask us to show you how you’ll save by paying biweekly or weekly, instead of monthly. Paying more frequently can save you hundreds of dollars in annual interest costs. To calculate the difference, use our Bi-Weekly Payment Calculator.
- Make the largest down payment you can afford. This will substantially reduce the length of time it takes you to repay the mortgage. If interest rates decrease when it is time to renew your mortgage, consider keeping your payments the same and applying more money to the principal.
- Make prepayments or anniversary payments. Most mortgages will allow you to make payments up to 20% of the entire mortgage once a year. This money is applied directly to the principal, saving you money in annual interest costs. Consider using your tax refund or annual bonus for this type of payment. Use our Mortgage Strategizer Calculator to calculate your savings.
- Make lump sum payments whenever your financial circumstances permit.
- Double your payments whenever possible.
- Choose a shorter length of time to repay your loan. Ask us to show you how selecting a 20 year amortization period instead of a 25 year amortization period will affect your payments and interest costs. Consider choosing 15 years to repay if possible. Your mortgage payments will be higher but you’ll pay substantially less interest over the course of the loan.
“From the very beginning of this process until the very end, Feisal was wonderful! Great communication, very quick to respond, very informative. Great overall experience.”
– Lori C.