Imagine if your house was yours, all yours, without a crippling mortgage … oh the freedom, the extra cash and the security you would have at your fingertips. Thankfully, paying off your mortgage sooner rather than later doesn’t have to be a dream. The best way to make sure your mortgage is paid off as soon as possible is to take out the mortgage with the very best rates in the first place. For example, navy federal mortgage rates may be better than the rates of a regular mortgage. That being said, there are some tips that make paying off any mortgage a little easier. Here are four great suggestions on how you can do it.
A quick what’s what
Mortgages are usually paid in two ways:
• Principal and interest – this is when you pay an amount off the actual sum borrowed plus the monthly interest.
• Interest only – where you just pay the interest on the loan each month.
The key to paying off your mortgage sooner is to go after the principal sum, so go for a loan that requires principal and interest repayments each month. When you do this, your statements will begin to show a decreasing mortgage. If you channel extra funds into it, your loan and its interest will reduce sooner.
If you haven’t got it you won’t miss it, or so the saying goes. One of the quickest ways to reduce your mortgage is to pay it in line with your paycheque. If that’s weekly, schedule mortgage repayments weekly. It’s best to have these repayments go directly from your bank account the night your pay goes in. By doing it this way, you won’t be scrounging around for cash at the end of the month. And by paying more regularly, you will cut down on your interest repayments, enabling you to tackle more of that principal sum sooner.
The lumps have it
Got a solid tax return this year or a sweet Christmas bonus? Pump it into your mortgage. The sooner you cut down on your principal sum, the lower your interest repayments will be because you’ll have less outstanding with the bank. And you won’t miss a bonus if you weren’t expecting it, right?
Go above and beyond
So you have your expected income that you based your mortgage application on. Now go above and beyond the call of repayment duty by picking up some extra income streams designated specifically for your mortgage. That might mean a little freelance work, some extra jobs on the side or having your money do the work for you by trading in stocks or currency.
Currency trading, where you purchase and sell foreign currency, is a great way to potentially make some serious extra cash. Renowned companies like Learn to Trade have great results to help you in this endeavour.
Having all your loans in one place with one weekly repayment is a must-do to tackle debt in general. Current economic conditions mean banks are more than happy to offer deals, so roll your high-interest credit card debts into your home loan and go hard to pay them off.
Paying off your mortgage quickly requires commitment and a plan, but the rewards allow you to invest, travel or lead a life free from financial stress. What could you do without a mortgage hanging over your head?