Paying down your mortgage is one way to build your financial confidence. Having to pay your mortgage each month can take a toll on your financial psyche, so here are a few ways that you can pay down the mortgage earlier.
The obvious way would be to just pay more towards your mortgage. Even just adding seven dollars more a month can reduce your overall interest payments. Over thirty years, just paying that little bit extra can reduce around four entire payments in the last months of your mortgage term.
Refinance with a short mortgage term. You’ll have to pay more with a fifteen year refinance so if that isn’t possible, the alternative is to refinance at 30 and try to pay it down as a fifteen. The fifteen year refinance is much stricter because it is a set amount, but if you treat the thirty like a fifteen, you will have some wiggle room.
Talk to your bank or lender to see if you can get setup for biweekly payments. Don’t pay any extra fees to do it because you could simply set up a system on your own. But, with biweekly payments you will end up paying thirteen monthly payments by the end of each year.
Use a money market account to gain interest on your home payments. That way you partially subsidize some of the home mortgage interest payments.
These are only a few ways to pay down your mortgage faster. Speak with a financial expert to determine the best course of action for you.