Get actionable tips from a mortgage expert on how to pay back your mortgage quickly in America’s high-cost economy.
You’re not imagining it. Life really is getting more expensive. Americans are feeling the economic pinch across the board, with the cost of gas, groceries, and everyday essentials increasing exponentially. Add to this an inflated real estate market, skyrocketing property taxes, and spiraling homeowner’s insurance premiums, and it is no wonder that families just like yours are desperate for ways to pay off their mortgage as quickly as possible. After all, don’t we all deserve some financial freedom?
Here are some statistics: according to a recent article published on Bankrate, 3 in 5 workers said their incomes hadn’t kept up with inflation throughout 2023. 51% of would-be homeowners said that the high cost of living has held them back from affording a down payment and closing costs for a home.
Irina Saveliev, a renowned mortgage expert, offers several tips to help you pay back your mortgage faster.
Make extra payments against the principal whenever possible. This might mean having to make cuts to your household expenses to free up funds for extra mortgage payments. This can be tricky, but it is a crucial step in reducing the overall loan term.
One effective method is to shift to a bi-weekly payment schedule. Making payments every two weeks rather than just once each month means that you actually make the equivalent of 13 monthly payments per year, rather than 12. That extra payment can go a long way, reducing interest accumulation and ensuring that your principal loan is reduced year on year.
Refinance To A Shorter-Term Loan
A shorter-term loan does what it says on the tin: your repayment period is substantially shorter than the average 30-year mortgage. In theory, this means your mortgage is paid back quicker, but it usually results in higher monthly payments. Therefore, you should consult with an expert mortgage advisor before committing to a more intensive payment plan and always ensure you have an emergency fund in place.
Choose A 30-Year First Position HELOC
Another option is to use a HELOC (home equity line of credit) to ensure that your payments go directly towards the principal loan rather than the interest. Refinancing to a HELOC also allows you to make unlimited payments, meaning that there is even more scope to pay off the mortgage when you can afford a little extra!
Changing Your Mortgage? Ask The Experts!
Make sure that you are taking every precaution to secure your financial security. You need to know you can afford to make more or higher payments before you commit to any new repayment plans. And it is important that you choose a mortgage plan that is going to work for your personal circumstances.
You can ensure your finances are in order and find the best refinancing options for your mortgage by speaking to a qualified advisor.
This content is provided in partnership with Paidoff and is intended for informational purposes only. The views, opinions, and advice expressed in this article are solely those of Paidoff and do not necessarily reflect the views or policies of any other individual, organization, or entity.
