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saving time and money on your mortgage

Having one of those days when you feel like your home will never be paid off? Take a deep breath — and keep reading.

While the road might be long, it's not endless. And it's certainly not out of your control. There are a number of ways you can shave months — and even years — off your mortgage. At the same time, you may be able to save thousands of dollars in interest. How?

By making more frequent payments. With many mortgages, you can choose to make payments once a week, once every two weeks, or once a month. Let's say you continue paying the same amount each month, but you split it into bi-weekly payments. You may get to the end of your mortgage ahead of schedule and paying significantly less interest. Why? Because by paying half your monthly amount just two weeks earlier, you'll incur lower interest charges for the other half of the month because you are paying interest on less principal. That means more of your payments go to paying down your principal. In addition, over the course of a year, you will make 26 bi-weekly payments, instead of 12 monthly payments. This typically means you are paying off more of your mortgage with a bi-weekly payment schedule over the year than you would with a monthly payment schedule. Over the course of your mortgage, the amount you save can really add up.
By increasing the amount of your regular payments. Some mortgages allow you to increase your mortgage payments by up to 100 per cent. The higher your payments, the quicker you'll repay your principal, and the lower your interest costs will be.
By prepaying a portion of your principal. When you have a little extra cash, you may want to repay a portion of your principal ahead of schedule. Some mortgages allow you to prepay as much as 20 per cent of your total original principal each year. That means you get to end of your mortgage sooner and save money in the long run.

Combine any of these options, and you'll speed down the road to paying off your home even faster! Remember, though, that these options are only available to you if the terms and conditions of your mortgage allow you to change the frequency and amount of your payments. That's why it's important to do the research when you apply for a mortgage, and to ask your financial institution about the flexibility of the payment terms.

saving time and money on your mortgage

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