Making extra payments on mortgage

Has anyone made extra payments on their mortgage principal?

Re: Making extra payments on mortgage

I haven't

I just left a meeting with my financial advisor and he says if its your forever house, do it.

One extra payment a year knocks 7 years off!

Re: Making extra payments on mortgage

We figured one extra payment divided by 12 and pay that much extra each month. It's a good idea and you can do it on your own, dont need to set up anything special with your bank.

Re: Making extra payments on mortgage

Yes, we make 1 extra a year so far.

Re: Making extra payments on mortgage

Yes - we do it all the time. I always pay about $100 a month extra towards the principal.

Then about once or twice a year, DH and I make a lump sum payment on the principal of between $2,000-$5,000. So far, we've gotten our 30 year mortgage down to 16 years this way.

Re: Making extra payments on mortgage

We make 1 extra payment a year on the anniversary of our closing.

I have no idea what we've saved so, that's DH's job to track.

Re: Making extra payments on mortgage

My Dh gets paid bi-weekly so there are 2 months with an extra paycheck, we put those two checks right towards principal.

Re: Making extra payments on mortgage

We usually have our monthly payment taken out of our savings with Bank of America. So we never mail the checks. Can I ask how each of you make the extra payment? Do you mail it in or do it online? Thanks!

Re: Making extra payments on mortgage

We've done it with our tax check every year, definitely knocks off alot of years!

Re: Making extra payments on mortgage

Re: Making extra payments on mortgage

Posted by Sunny10

We usually have our monthly payment taken out of our savings with Bank of America. So we never mail the checks. Can I ask how each of you make the extra payment? Do you mail it in or do it online? Thanks!

Re: Making extra payments on mortgage

I pay bi-weekly, and have set the payment amounts to be several hundred dollars more than our payment. In essence, we end up paying more than two extra principal payments each year.

We only moved here about 9 months ago, so not sure what it's done to the life of our loan.....however we used the same strategy at our last house and built up over $10k in equity in just a year. Helpful to us as we had short-term plans to sell and the added equity made a difference to our bottom line.

Re: Making extra payments on mortgage

We are with BOA and you can make extra principal pymt online

Re: Making extra payments on mortgage

My DH is making double mortgage payments; I was surprised how much he's paid off!!! Mary

Re: Making extra payments on mortgage

We make 3 extra payments a year, and pay bi weekly. We bought our house in 2007 and are scheduled to have it paid off in 9 more years.

This is our forever house (after much back and forth about moving). Any amount towards principle makes a huge difference on the interest you pay. I think we are saving almost 200K in interest over the life of the loan by doing this.

Re: Making extra payments on mortgage

We re-fi'd last year to a 15 year mortage, and I want it paid off in 13 years, when DH can retire, so I went on a mortage calculator online to see how much extra I have to pay every month and I send it quarterly to Wells Fargo.

Re: Making extra payments on mortgage

wow i never relized how much you can save on years just by adding one extra payment a year... Im going to tell DH tht i think we should do this. Thanks for the advice!!

Re: Making extra payments on mortgage

We pay extra every month. About $150 dollars. And last year the taxes went down a bit but I have just been paying the same amount plus the difference. Its amazing how little actually goes to principle every month on a 30 year mortgage. I basically pay double that and will be able to cut my mortgage in half with just a little bit more every month

Re: Making extra payments on mortgage

Posted by CAMCaps

Posted by Sunny10

We usually have our monthly payment taken out of our savings with Bank of America. So we never mail the checks. Can I ask how each of you make the extra payment? Do you mail it in or do it online? Thanks!

My DH just made our automated payment more.

Re: Making extra payments on mortgage

Posted by Katareen

Posted by CAMCaps

Posted by Sunny10

We usually have our monthly payment taken out of our savings with Bank of America. So we never mail the checks. Can I ask how each of you make the extra payment? Do you mail it in or do it online? Thanks!

My DH just made our automated payment more.

Does the Bank typically know to apply this extra to the principle? I tried doing this with my student loan and they ended up taking it from the "front" of the loan instead of the back--and I was a month ahead with my payments but my principle wasn't reduced.

Re: Making extra payments on mortgage

When I make an extra payment, I always do it by check. I've heard many stories where ppl add it to their regular payment and it goes to interest (which defeats the purpose of an extra payment). In the memo line I write "Princl only." Then I check my next statement to make sure it was applied that way. So far it's been ok.
If you are making the extra sacrifice, you want to make 100% sure it's going to the right place!

Re: Making extra payments on mortgage

Re: Making extra payments on mortgage

If you can swing it it is a great thing to do if you plan to be in the house forever.

It also sometimes pays to just make bigger payments versus refinancing to a lower rate when you consider the cost to refinance.

There are a ton of online calculators to help figure out savings, cost to refinance versus paying extra, etc.

You can cut your mortgage almost in half by paying one extra payment a year. Even $50 extra a month adds up to thousands saved in interest.

Re: Making extra payments on mortgage

extra 200 month and 2-3 extra payments a year

Re: Making extra payments on mortgage

We do this and pay a bit extra every month...it will cut down your time, granted you don't refinance and add more