Title:
Mortgage
Calculator Reveals Big Savings With Small Payments
Word Count:
520
Summary:
Having agreed on
a monthly payment schedule with your mortgage lender doesn't necessarily set
that amount in stone - that's just the minimum you can pay! By playing with a
mortgage calculator, particularly a pre-payment loan calculator, you can see
where extra payments can make long-term savings on your mortgage.
The mortgage calculator will quickly show that you don't have to pay large sums
of additional cash in order to make a difference. Even regular smaller sums can
g...
Keywords:
mortgage,mortgage
calculator,home loans
Article Body:
Having agreed on
a monthly payment schedule with your mortgage lender doesn't necessarily set
that amount in stone - that's just the minimum you can pay! By playing with a
mortgage calculator, particularly a pre-payment loan calculator, you can see
where extra payments can make long-term savings on your mortgage.
The mortgage calculator will quickly show that you don't have to pay large sums
of additional cash in order to make a difference. Even regular smaller sums can
greatly reduce the length of time you are paying your mortgage. They will even
reduce the amount of interest you would be paying. Imagine that the mortgage
you thought would be with you until you were 50 can be painlessly paid off by
the time you are in your mid 40s! That's strong motivation to try out the
appropriate mortgage calculators to see what kind of financial additional
payments you need to make this achievement.
The first thing you need is to use a home budget calculator to check your
current financial situation. How much disposable income do you have each month?
Where does this go currently? Could you comfortably commit an additional $50 a
month, for example, to your mortgage? Put that figure into the mortgage
calculator and see what difference it would make to your long-term mortgage
picture.
It can get addictive to try and shave off more of your disposable income and
put the increased amount into the mortgage calculator, but beware of
over-stretching your finances. While it's exciting to see how much faster you
could pay off your mortgage, and so fast to see the results that the
pre-payment mortgage calculator gives you, it's also easy to get carried away
and forget that you need to keep finances in hand for other things!
One of the best things you can do is to find a minimum additional monthly
payment that you can make without creating too much of a problem - perhaps by
canceling subscriptions you don't use, or by cutting out one trip to a
well-known coffeehouse each week. Use the mortgage calculator to work out the
difference this makes to your mortgage principal. This is the least impact you
will make on your mortgage.
Next try and save an additional sum in a separate banking account and try not
to touch this. If you haven't had any emergencies requiring the money during
the year, withdraw it after 12 months and make a single extra additional larger
sum payment against the capital (still making that basic monthly payment in the
same month!) and then use your mortgage calculator to see how much difference
this has made. This way you can keep that money handy and still reduce your
mortgage. But it will not reduce your interest as much as paying out monthly.
Be sure to check out all these variables on the mortgage calculator.
A mortgage for your home is a long-term commitment, but using a mortgage
calculator you can see how it's possible to reduce the time period with
additional small monthly payments. Paying off your mortgage quicker, and paying
less interest, without financially hurting yourself - isn't that worth
exploring further?