Buying a home is a major life step.
Homes are by nature expensive and most home buyers cannot afford to purchase a home outright. Because of that reality, most home buyers finance a home purchase with a mortgage.
A mortgage allows you to spread the payments for a home loan across many years. The result? Mortgages can make home ownership much more attainable for the average home buyer.
How to pay off your mortgage faster
If you’re interested in paying your mortgage off more quickly, here are two common strategies you can use:
Extra payments every month. A more common way to pay a mortgage down early is simply to make extra payments to the loan’s principal each month, as frequently as possible. Whether it’s five dollars or one hundred dollars extra per month, every additional principal payment you can make toward paying a mortgage down more quickly really adds up. To show you how that would work, Vanderbilt Mortgage has developed an early payoff calculator to show how much you can save by paying extra toward the principal each month.
Annual Additional Payments to Principal — you can also help pay your mortgage off faster by making extra payments to principal once a year. Whether it be a tax refund you receive, yearly bonus or extra savings, this investment toward paying your mortgage off sooner can help save interest cost in the future.
Go at your own pace
It’s important to remember not to overextend yourself while you’re working to pay a mortgage down. Create a realistic budget and go at a pace you can afford, and you will reap the long-term benefits. Your future self will thank you. Visit Vanderbilt Mortgage to learn more home owner tips or apply for mortgage today.