In 2014, Calgary mortgage broker Steven Crews, from Verico iMortgage Solutions, did a series of radio broadcasts about mortgages and mortgage financing for Shine FM. Have a listen and you’ll pick up some helpful tips…
If your goal is to pay off your mortgage faster, then every little bit helps. Here I discuss a couple of basic ways that you can just pay a little extra and take years off your mortgage.
It’s not the payment frequency that helps you pay off your mortgage faster, it’s actually the total amount that you pay each year that counts…
Once a client gets a mortgage, their next goal is to pay the mortgage off as fast as possible. There are a number of ways to do this.
First, you can accelerate the mortgage payment. You do this by making one extra mortgage payment each year. If you choose a Weekly or bi-weekly payment option, then the payment is almost always automatically accelerated. You can also accelerate a monthly payment by increasing it by a little over 8%.
Therefore a monthly payment of one thousand dollars can be increased to one thousand and eighty three dollars. You can also take advantage of pre-payment privileges. Most lenders will offer options to increase the payment each year. Even an increase of just ten dollars each month can shave years off of your payments.
The other option is to make lump sum payments to pay off your mortgage. Many lenders will allow anywhere from 10% up to 25% lump sum payments. This is generally calculated based on the original principle. Most lenders have a minimum lump sum that they allow but every lump sum payment goes directly towards the principle of the mortgage.
This will help you to be mortgage free faster!
Give your feedback. If you have a question, or topic that you would like to learn more about, let me know. If your question or topic is used on the ShineFM Mortgage Expert segment you will receive something special!