Ellen’s Quick Tip to Reduce Mortgage Interest
Do you want to pay off your mortgage faster? How about saving money by reducing how much interest you pay over the loan’s lifetime? Ellen Zetmeir makes homebuying, owning, and selling easy. 
Congratulations! You own your own home….. kind of. Does paying mortgage seem like it’ll last forever? Whether you bought your house through Ellen or not, she’s here to give you a quick tip on paying off your mortgage faster!
Most regular payments are due monthly by default, and mortgage payments are no exception. Ellen’s quick tip for your mortgage is to update this automatic time frame to a biweekly alternative!
Why Pay Biweekly vs. Monthly
Most homeowners never update their payment plan from a monthly system to a biweekly structure simply because it never occurs to them that this can be changed. Don’t be afraid to search out your options with payments! From refinancing to restructuring your payment time frame, Ellen wants you to know that you have options!
When you pay biweekly, you’ll pay half of your monthly amount every two weeks instead of your usual once-a-month payment. Since there are 52 weeks in a year, this works out to 26 biweekly payments. This means that every year you’ll be making about 13 monthly payments instead of 12! Keep a sharp eye out for the word “biweekly” because “bimonthly” means something else! Bimonthly payments can save you a little – but not nearly as much as a biweekly system; read more on that difference here!
The key to understand is that you’re not just “getting ahead” on payments – what you’re doing by paying at a biweekly structure is lowering your principal balance at a much quicker rate and paying less total interest in the long run! Hooray!
Consider a $250,000 30-year loan with a 4.1% rate; with a biweekly payment system, the mortgage will be paid off four years early and save the borrower almost $30,000 in interest. Check out these helpful visual graphics included courtesy of Mortgage Calculator!
A Word of Warning
Ellen wants to help you pay off your mortgage and save money – but there are a couple of things to know first!
Many credit unions, banks, and lenders offer biweekly payment programs; however, when the lender doesn’t offer this option, certain borrowers opt for a third-party payment processing company. These services often charge monthly fees; others may charge for a setup fee that can reach up to a couple hundred dollars! Use caution when enrolling with a third-party service especially as the contract may be more binding than you’d think!
If a company contacts you offering to save you thousands in mortgage or credit card payments, be very careful – some of the payment processing services will retain your second payment for the two weeks and just make monthly payments on your behalf – completely voiding the purpose of the biweekly system. This means you’ll be paying a third party to make your default monthly payments – you’ll lose money and still have to pay the full term of your loan instead of saving interest and paying off your mortgage early.
Your Mortgage Made EZ – thanks to Ellen!
Whatever your concerns, paying off your mortgage is feasible, and Ellen is here to make it as EZ as possible! Researching in preparation for buying your own home? Ellen can make your dreams come true – and fit your budget! Contact her today for any and all homeowning information! Looking to sell? Ellen’s got it covered – give her a call at 816 489 6950.
