We all know that paying off a mortgage as early as possible makes good financial sense. You’ll save significant interest costs, free up money for RRSPs and other investments, and changing lifestyle needs. Here are 5 strategies to help you become mortgage free sooner:
- Add a bit to your monthly payment. Most of us can find an extra $50 per month by cutting out a restaurant meal. Add that money to your mortgage and you’re saving big on interest down the road.
- Make a yearly pre-payment. Paying an extra one or two thousand on your mortgage once per year on the anniversary date of the mortgage could yield significant savings over the life of the loan. Take advantage of a tax refund or bonus from work. Lump-sum mortgage prepayments have a much greater impact on the total amount of interest you’ll pay if they are made early in the mortgage.
- Increase your mortgage payment if your income increases. Pretend your income didn’t increase and maintain your usual lifestyle.
- Choose accelerated bi-weekly payments. Instead of paying your mortgage on a monthly basis 12 times per year, pay your mortgage every two weeks for a total of 26 payments, effectively giving you one more mortgage payment each year.
- Stay informed. Don’t let your mortgage go on auto pilot. Let me stay in touch with you throughout your mortgage years. I can help you save money at renewal, and will keep you up-to-date on rates and new mortgage options. You can save thousands just by understanding what your options are and by taking advantage of opportunities.
If you are in Vancouver or surrounding areas , let me help you build a plan to become mortgage free sooner! Send me an email.