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#1
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Good advice, Phat. Even if you cannot add an extra amount as large as yours ($200/$550 = 36.36% more), simply paying 1/2 of the monthly mortgage payment every two weeks can reduce the term of a 30 year note down to about 21. By doing that, you actually make an extra monthly payment every year, and every time you can reduce principal it helps. For example, if mortgage payment is $1000 a month, you would pay $12,000 per year via traditional method, or $500 x 26 bi-weekly payments = $13,000 per year, with most of that extra $1000 per year going toward reduction of principal balance.
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#2
02-01-2008, 05:42 PM
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Yeah, i realize that a 550 monthly payment now days is unrealistic. i'm paying almost 200 a month now in proptaxes & homeowners & i own the house, thats almost half of when i was paying P&I + taxes & ins.
also make sure you are directing the extra money go to the principal..I had a friend who was just sending in an extra payment with the coupon and they were applying it to principal & interest, not principal only...
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