Patricia White's Blog
Paying off a mortgage early is a dream of many homeowners. By making larger payments on your home loan, you can cut years off of your loan term and save thousands of dollars in interest payments that you can use toward savings or investments. But in an economy that has seen decades of wage stagnation and increasing costs of living, it can often seem like an unattainable goal.
With some planning and initiative, however, there are ways to pay off your home loan before your term limit.
In today’s post, we’re going to talk about three of the ways you can start paying off your mortgage early to avoid high interest payments and save yourself money along the way.
1. Refinance your mortgage
If you’re considering making larger payments on your mortgage, it might make sense to look at refinancing options. Most Americans take out 30-year, fixed-rate mortgages.
If you can afford to significantly increase your mortgage payments each month, you could refinance to a 15-year mortgage. This will save you on the number of interest payments you’ll have to make over the years. But, it will also help you secure a lower interest rate since shorter term mortgages typically come with lower interest rates.
This option isn’t for everyone. First, refinancing comes with fees you’ll have to pay for upfront. You’ll have to apply for refinancing, get an appraisal of your home, and wait for the decision to be made.
But, you’ll also have to ensure that you can keep up with your higher monthly payments. If your income is variable or undependable, it might not be the safest option to refinance to a shorter term mortgage.
2. Make extra payments
An option that entails less risk than refinancing is to simply increase your monthly payments. If you recently got a raise or are just reallocating funds to try and tackle your mortgage, this is an excellent option.
Depending on your mortgage lender, you may be able to simple increase your auto-pay amounts each month, streamlining the process. Otherwise, it’s possible to set up bill-pay with most banks to automatically transfer funds to your lender.
3. Bi-weekly payments or one extra payment per year
Making bi-weekly instead of monthly payments is an option that many homeowners use to pay off their mortgages early. Bi-weekly payments work by paying half of your monthly payment once every two weeks.
The vast majority of homeowners make 12 monthly payments per year. But by switching to 26 bi-weekly payments, you can effectively make 13 full monthly payments in a year without seeing too much of a difference in your daily budget.
This doesn’t seem like much savings in the short term, but let’s take a look at how much you could save over the term of a 30-year mortgage.
On a 30-year fixed mortgage of $200,000 with a 4.03 annual interest rate, you would make a monthly payment of $958.00 and a bi-weekly payment of $479.
Over 30 years of an extra monthly payment, you could save nearly $20,000 on the total interest amount and pay off your mortgage almost 5 years early.
124 Village Post Road, Danvers, MA 01923
Ready to embark on a new adventure? List your house, and you may reap the benefits of your decision for years to come.
Ultimately, there are many reasons why you should consider kicking off the home selling journey today, and these include:
1. You could profit from a home sale.
Diligent home sellers generally have no problem showcasing their properties to dozens of prospective buyers and generating significant profits. If you know how to effectively promote your residence to property buyers, you could enjoy substantial profits from your home sale.
Oftentimes, it helps to bolster a house's curb appeal prior to adding a residence to the real estate market. A home only gets one chance to make a positive first impression on buyers. And if your residence boasts a dazzling front lawn, pristine siding and other stunning exterior features, it may be better equipped than other properties to stir up interest from buyers.
You may want to get your house appraised too. This ensures you can get a property valuation from a home appraiser and establish a competitive initial asking price for your residence.
2. You can upgrade or downsize.
Although your present home may have suited you perfectly when you initially bought it, now may be a good time for a change. Fortunately, you can upgrade or downsize as needed if you sell your home.
Think about your current living situation and future plans. Then, you can simultaneously list your residence and search for a new house that matches your criteria. And once you finalize your home sale, you can seamlessly relocate to a new address.
3. You can live closer to family members and friends.
If you enjoy spending time with family members and friends, you may want to find a house that is close to these loved ones. Meanwhile, if you currently are forced to deal with a long commute to visit loved ones, listing your house may help you take the first step to live near family members and friends.
When it comes to finding a house near loved ones, it may be beneficial to hire a real estate agent as well. A real estate agent can help you list your current residence and search for a new home close to family members and friends. That way, you can get the support you need to accomplish your desired goals.
During the home selling process, a real estate agent will showcase your residence to potential buyers and negotiate with a buyer's agent on your behalf. He or she also will respond to any concerns or questions that you may have throughout the house selling journey.
Furthermore, if you need to find a new home once you sell your current residence, a real estate agent is happy to assist you. This housing market professional can keep you up to date about available properties in your preferred cities and towns and help you find your dream residence.
Hire a real estate agent today, and you can receive expert guidance any time you want to sell or buy a house.
124 Village Post Road, Danvers, MA 01923
Once you’re ready to sell your home, you want to be sure that your home is smelling fresh. There’s a few sneaky odors that can creep into your home for various reasons. The consequences of horrible smells when you’re selling your home are really not good. Read on to prevent funky odors from turning off buyers from your home.
Food That’s Past Fresh
Whether your garbage disposal is a bit clogged and could use a cleaning or your fridge hasn’t been purged in awhile, these things could be causing a stink. Make sure you stay on top of leftovers and take care of anything that may be in the refrigerator for too long.
Clean your garbage disposal often. It’s simple to make a “volcano” by throwing some baking soda down there and then pouring vinegar over it, allowing everything in the disposal to bubble up. You can even put a lemon or lemon juice in the disposal in order keep a good smell going.
That Wet Dog Smell
Any kind of animal will leave some sort of odor in your home. Whether you have a dog, a hamster, birds, or cats, you’re going to need to freshen up your space. Keep the litter box changed and add some baking soda for a bit of freshness. Make sure to remove any stains on your carpets or floors as well. If a piece of furniture or a carpet is to blame for the strong odors, you may need to remove that piece from your home completely to get the stench out.
Your Air Conditioning Smells Bad
Since water can build up inside of your air conditioning unit, sometimes, a bit of maintenance is necessary. AC units must be cleaned regularly in order to keep strange smells away.
Something Smells Musty
A musty smell usually spells a water leak. Whether it’s in your basement or under your sink, you need to correct leaks in order to get to the root cause of musty smells.
Clean A Carpet With Vodka
You can put some cheap vodka in a spray bottle in order to clean a carpet. This technique can be used for more troublesome areas of the rug. As the alcohol evaporates, so won’t the odors that are filling your home.
The Air In Your Home Is Stagnant
When the air in your home smells kind of stale, you’ll need to get the air circulation back in the house again. This can be easily remedied just by opening the windows. Even if it’s cold outside, it’s good to get the air circulating in your house again. This simple action effectively changes the air in your home without any fancy chemicals or techniques.