Use these tips to shorten your mortgage term exponentially and own your home faster.
Are you thinking of buying or custom building your first home or perhaps your second or third? The normal mortgage term is 30 years, meaning you will pay your home off in 30 years. That is quite a long time and may take up most of your time living there. You can have peace of mind fully owning your home with a shorter mortgage term. Consider these ways to shorten your mortgage term and see if it fits your financial plan.
Start with a Larger Down Payment
The first way to shorten your mortgage term is to start with as large a down payment as possible. Save up as much as you can to have the lowest mortgage principal as possible and thus the shortest loan term. The amount you save up will depend on how urgently you need to move house.
Round up Monthly Payments
There are also plenty of tactics to shorten your mortgage term by years even with a 30-year mortgage loan. One method is to round up your monthly payments. For instance, if your monthly payment is $1,570, you could round it up to $1,600. The extra payments add up quickly!
Increase by One Dollar per Month
Another method is to increase your monthly payment by one dollar per month or another interval, like per year. It works best if your wage increases by a similar, consistent amount. An extra dollar might not seem like much, but it also adds up quickly over time.
Use Extra Cash for the Mortgage
Did you get an unexpected bonus or monetary gift? If you are serious about paying off your mortgage loan fast, you can put it immediately into your new home. You could even use your tax returns as fuel. You can use anything as long as it doesn’t cut into your monthly budget.
Make One Extra Payment per Year
If you aren’t up for paying extra wherever and whenever you can, or paying per month, you could also just make one extra payment at the end of each year that is an equal amount to your other monthly payments.
Refinance Your Mortgage
The most common strategy is simply to refinance your mortgage. If you have accumulated enough savings over time, you can “reset” your loan and make it even shorter.
BUILD YOUR WATERFRONT DREAM HOME WITH SHORE-LINE CONSTRUCTION!
At Shore-Line Construction, we know that your home is a reflection of you. That’s why we strive to make each home we build as beautiful as the family who will live there. We work with each of our clients to design a home that fits their needs. The end result is a durable, energy-efficient custom home that the family will enjoy for generations to come. Shore-Line Construction has been serving our customers for over 25 years, and we look forward to the opportunity to help you!
If you’re interested in learning more about what Shore-Line Construction can do for you, check out our website or give us a call at 410-574-6623. Keep up with all of the latest news by following our blog and social media pages on Facebook, YouTube, Pinterest, and Houzz!
