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Paying Mortgage Faster |
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Dear Ms. Lank, is there a simple way for my son to send in extra mortgage payments – maybe pay every two weeks with the additional money applied to the principal? I’m sure you’ve explained this before, but he just bought a small townhouse and now the answer is relevant to us |
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Unless he is specifically enrolled in a bi-weekly plan, your son should make his regular monthly payments. Half-payments would only confuse the lender's computers. He could end up with all sort of complications, including late payment penalties.
Assuming his particular mortgage plan has no pre-payment penalties, he can send in any amount of extra money whenever he wants, on a separate check, marked "to be applied entirely to principal reduction." That will pay off a fixed-rate mortgage ahead of schedule, and save on interest charges for any type of mortgage |
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Edith
Originally published on November 6, 2006 |
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