How To Pay Your Mortgage Off Early.
If you have a home mortgage you’re likely paying on the home mortgage for 15 to 30 years which is a long time.
If you have a 15 year mortgage then it’s not as bad as a 30 year mortgage since 30 years is way longer to pay on a home mortgage and you’ll pay lots more in interest on the 30 year mortgage than you would on a 15 year mortgage.
15 year mortgage VS 30 Year Mortgage.
If you haven’t gotten a mortgage yet you may be wondering if you should get a 15 year mortgage or a 30 year mortgage instead?
To decide whether you should get a 15 year mortgage or a 30 year mortgage you need to figure out what amount of payments you’ll be able to make on the mortgage.
Although a 15 year mortgage will allow you to pay off your home mortgage much sooner than a 30 year mortgage the 15 year mortgage will usually require a more sizeable down payment and a higher monthly mortgage payment.
The 30 year mortgage can be applied for with less of a down payment.
If you can afford the higher monthly payments and higher down payment then you should opt for the 15 year mortgage and do your best to get it paid down sooner if you can.
How To Pay Down A 15 or 30 Year Mortgage Sooner.
Now that you’ve gotten the mortgage or have had the mortgage for awhile now you may be wanting to pay down the mortgage sooner and be debt free from your house?
Some ways you can do that are paying extra on the monthly mortgage payment so if your mortgage is $1,500.00 per month you should send in an extra $300.00 to $600.00 per month which will help you bring the balance down on your mortgage sooner.
You can also find some extra ways to make the extra money to pay down that mortgage sooner as well.
Maybe try freelancing, blogging, cleaning houses, mowing lawns, selling scrap metal etc.
The list is endless as there’s always ways to make some extra money to apply towards your mortgage payments.
Maybe you can ask your boss if you can work extra hours as well to bring in the extra income or take out a second job.
Benefits Of Having A Mortgage Paid Off.
You may be wondering what the benefits of a paid of mortgage are. Some people prefer to keep the mortgage and invest the extra monthly payment money into stocks, bonds or other investments so they see a return on their money.
But if you can instead you should put that money towards paying off your mortgage sooner so you’ll have your home free and clear and won’t have that monthly mortgage payment lingering over your head or on your back.
Don’t get me wrong you still will have Real Estate Taxes to pay otherwise you’ll lose the house due to a Tax Foreclosure but your Real Estate Tax Payment will likely be much more cheaper than your mortgage payment and you have up to 3 years to pay your Real Estate Taxes before losing your home to Tax Foreclosure.
Now Onto The Benefits Of Having A Paid Off Mortgage.
Once you have your paid off mortgage the best benefit is that should you lose your job or income you’ll be able to stay in the house and not have to pay the bank the mortgage payment each month and risk foreclosure.
This gives you time to find another job or other income stream.
You’ll also have that extra monthly mortgage payment money to put towards something else or even into an emergency fund or savings account.
You’ll save money on interest over the Loan Term.
If you pay off your mortgage early you’ll be saving thousands of dollars per year by not paying all that interest that will accrue over the 15 or 30 year time frame.
The banks prefer you to keep the mortgage going for the full mortgage loan term because they make their money through the interest charged.
So if you pay off your mortgage early you may have to pay a little early payoff fee for the mortgage depending on the bank but the payoff fee will still be cheaper than paying all the interest over the loan term.
So Should You Pay Off Your Mortgage Early?
That’s entirely up to you and what you really want.
But in my opinion I would want to pay off my mortgage early and then invest the mortgage payment money or put the mortgage payment money into a savings account.
It’s a great feeling to have a paid off house that you know is all yours and not the banks anymore even though you still have to pay the Real Estate Taxes.
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