Mortgage changes
- Thread starter Merlin99
- Start date
StrawberryGal
Sweet and Innocent
You can send more money in and have it apply to principal. You do not need to change the loan agreement. Most banks do not care if you pay more than your monthly payment as long they're getting their money. If you are gonna to pay it off, you will need to call the bank to get the "pay off" balance amount to be able to pay it in full and be free of mortgage. They will mail you a deed showing that you've paid in full.
GWguy
*
:this: if you are paying it off in full. If you jsut want to pay down faster, just give them more money per month, or a lump sum, but specify it goes to the Principal.
TGB
New Member
One you can try to refinance to a lower interest rate with 15 year mortgage. However, this is assuming the low interest and all the cost of refinace are worth it.
Second option is making extra payments along with your regular payments. "IF" you can, try to make the extra payment the same amount of your payment or at least half the mortgage amount. If not what ever you can afford.
I am not a fan of weekly payments. I have Wells Fargo and when I was making weekly payments, they held onto to my payments and applied it all at once at the end of the month which was not worth it to me. So now I write an extra payment along with my mortgage.
Hope this helps.
Second option is making extra payments along with your regular payments. "IF" you can, try to make the extra payment the same amount of your payment or at least half the mortgage amount. If not what ever you can afford.
I am not a fan of weekly payments. I have Wells Fargo and when I was making weekly payments, they held onto to my payments and applied it all at once at the end of the month which was not worth it to me. So now I write an extra payment along with my mortgage.
Hope this helps.
SoMD_Fun_Guy
Do you like apples?
You may also want to check to see if there are any "fees" for early pay-off. I've heard that can happen.
Baja28
Obama destroyed America
Read your loan documents. There most likely are no fees but definitely check. You can also make bi-monhly payments that reduce interest.
Any additional amount you pay has to be applied to principle by law.
Chasey_Lane
Salt Life
If you write a check each month to the mortgage company, on the memo line write "additional applied to principle." If there are ever any issues, you are covered.
ProfMoneyWise
Member
Well done.
Owning where you sleep, eat, relax is a wonderful thing.
I like to say if you cannot fathom owning where you live you have to much house. I also call this "Underwater Proofing"
Read your documents for any sort of early payoff penalty. Call your mortgage provider to verify there are no early payoff implications.
Then pound that principal into submission.
I caveat all the above by saying that before you do this please be:
1. Debt-free except for the house.
2. Have an Emergency Fund of 3 - 6 months living expenses set-aside specifically for this purpose.
3. Be investing at least 15% of your total household income into good growth stock mutual funds.
4. If Kids college is in your future, attend to this as needed.
5. Have funds set-aside, or on a programmed type funding schedule, for known expenses over and above your monthly requirements. Such as car maintenance/replacement, home maintenance, insurance, Christmas, etc.
then . . . start to own where you live and pay off the house.
ProfMoneyWise
Member
You can also make bi-monhly payments that reduce interest.
Any additional amount you pay has to be applied to principle by law.
Some charge a fee to set-up a bi-monthly payment schedule. To avoid the fee and to accomplish the same thing (within a few dollars in the end) is to divide your P&I by 12 and add in that amount to your monthly payment and designate this as principal.
The bi-monthly is 26 half payments which equates to 13 payments per year.
If you just make the extra each month, or even a double payment once each year, you are in the ballpark with interest savings.
Not sure about the law part of having to apply to principal but I do know one needs to verify every time a payment of extra principal is made. No harm meant by the provider as the processing of your payment somewhere along the line involves a fellow human and these things can happen.
It is better to make 1 additional payment at the beginning of the year (Jan) vice Dec. I wouldn't refi to do a 15 year mortgage but would figure out what the amortization difference from a 30 year to 15 year mortgage. Here is what I noticed about people in general.
Most people make the most money from age 35-50 and it is hard to kind of tough at your peak. So what happens when you retired and you make less!! Get rid of those car notes and pay off the house.
Most people make the most money from age 35-50 and it is hard to kind of tough at your peak. So what happens when you retired and you make less!! Get rid of those car notes and pay off the house.