Steps to Financial Security - Baby Step #7
Pay Off Your Home Early
Paying off your home early can save you tens of thousands of dollars on interest alone. Below are a few easy ways to help you pay off your home early:
- Switch to a bi-weekly payment. Instead of making one monthly payment, you can make a half-sized payment every two weeks. By doing this you can potentially take up to eight years off of your 30 year mortgage!
- Make extra principal payments. If you make extra principal-only payments on your loan, you will pay less interest in the long run.
- Refinance into a shorter-term loan. If you can afford a higher payment, switching from a 30-year mortgage to a 15-year mortgage can save you more money on interest. One thing you want to keep in mind though is which interest rate is better. For example, if the interest rate for a 30-year mortgage is better, stick with a 30-year plan but pay on it like a 15-year plan.