Finding the Cash
If you get paid every two weeks, twice a year you’ll get an “extra” check. Consider putting those two checks directly toward your mortgage. Even taking half of them and paying down your loan will help reduce your loan term and the amount you owe.
If you decide to make just one extra payment a year, consider budgeting for it every month. An extra payment of $1,003 is $83.58 per month, or $19.29 per week. Committing to setting aside the cash on a regular basis can make it seem more manageable, especially if it means just skipping a couple of coffees and lunch out one day each week.
Is This the Right Choice for You?
Remember, however, that paying off a home mortgage loan may not be the best choice for everyone. If you have other loans, especially ones with higher interest rates than your mortgage, then they should probably be your priority to pay off. Credit cards and car loans usually have higher rates than home loans.
In addition, the government currently allows homeowners to write off mortgage interest payments on their taxes.* if you are seeing significant benefits from this credit on your tax returns, you may not want to pay off your home loan at this time.
Making a Decision
Paying off your mortgage, as you can see, is not a decision to be taken lightly. Be sure to review all your debts and the interest you’re paying. You may want to consult a financial planner or accountant to ensure eliminating this debt will have a positive effect on your finances.
If paying off your loan early is a move you’re contemplating, please contact me so I can help you review your options, recommend a local financial expert if you need one, and provide any assistance I can so that you’re able to make the best decisions for your personal financial security. I look forward to helping you save some money!