Mortgage Logic

How can I save interest cost and shorten the life of my mortgage?

Save interest by buying your mortgage through a mortgage brokerage like us. Lower your interest cost over the life of your mortgage by using the accelerated payment approach. You can save some interest making bi-weekly or weekly payments, but the most significant impact on reducing your amortization period (life of your mortgage) is increasing the total payments made against your mortgage each year.

Biweekly payments total 26 times per year, whereas semi-monthly payments occur 24 times per year. If the monthly payment is divided by two and paid biweekly, you in effect are accelerating your payments by making the equivalent of one extra monthly payment per year. The extra monthly payment is what reduces the length of your mortgage. You can accomplish the same thing by just increasing your monthly payment, if monthly is a more convenient payment frequency for you. Another option is to take an accelerated semi-monthly payment frequency.

A payment frequency that is tied to your pay dates usually makes the most sense, and should typically be used.