Want to start the year off by cutting a few years off your mortgage? Here’s a budgeting trick that can help you do just that!

The secret to cutting a few years off your mortgage is making just one additional mortgage payment every year. That payment, on the majority of mortgages, is going to be paid 100% toward principle, reducing the amount of interest that you will pay over the life of the loan. But how can you make that extra payment?

  • Contact your lender and ask to make a bi-weekly mortgage payment. You’ll be paying your mortgage every 2 weeks, and over the course of a year, that means you’ll make one extra months payment!
  • Or, divide your monthly mortgage payment by 12. Add that 1/12 to your monthly mortgage check. By the end of the year, that will be 13 months of payment!
  • Or, if you are in a job where you have commissions or bonuses, use the extra income to pay one additional mortgage payment each year.

So as you get into the 2021 budget, make a minor change that will save you BIG money! In a few years, you’ll be glad you’ll did.