Making regular extra payments toward the principal balance will yield enormous returns. You pay more on principal by employing various techniques. For many people,Perhaps the simplest way to keep track is to make one extra payment a year. However, many folks can't pull off such a large additional expense, so dividing one additional payment into twelve extra monthly payments is a great option too. Finally, you can pay a half payment every other week. Each option yields different results, but each will significantly reduce the length of your mortgage and lower the total interest you will pay over the duration of the loan.
Some folks can't manage extra payments. But you should remember that most mortgages will allow additional payments at any time. You can take advantage of this provision to pay extra on your mortgage principal when you get some extra money. If, for example, you were to receive a surprise windfall three years into your mortgage, investing several thousand dollars into your mortgage principal can reduce the repayment period of your loan and save enormously on mortgage interest over the duration of the loan. Unless the mortgage loan is quite large, even a few thousand dollars applied early can produce huge savings over the life of the loan.
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