Save on your Mortgage Loan
Paying regular additional payments on the principal will yield big returns. People pay extra in a few ways. For many people,Perhaps the easiest way to keep track is by making one extra payment a year. However, many folks will not be able to afford such an enormous additional payment, so dividing one extra payment into 12 extra monthly payments works as well. Another option is to pay a half payment every other week. The effect here is that you will make one extra monthly payment each year. These options differ a little in lowering the total interest paid and reducing payback length, but they will all significantly reduce the duration of your mortgage and lower your total interest paid.
Lump-sum Additional Payment
Some borrowers just can't make any extra payments. Keep in mind that almost all mortgages will permit you to make additional payments to your principal at any point during repayment. Whenever you get some extra money, consider using this rule to make a one-time additional payment toward your mortgage principal.
If, for example, you were to receive a very large gift or tax refund four years into your mortgage, paying several thousand dollars into your mortgage principal will significantly shorten the period of your loan and save a huge amount on mortgage interest paid over the duration of the loan. Unless the loan is quite large, even small amounts applied early can yield huge savings over the life of the loan.