A mortgage is one of the biggest financial responsibilities you can have. Here are 4 tips on how to shave the years off the term of your debt and save thousands in unnecessary interest payments.
As a homeowner, a mortgage can be your biggest source of debt and often the concern arises: who would pay off your mortgage and other debts if something terrible, such as illness or death, were to happen to you?
Purchasing a flexible and affordable mortgage life insurance is an absolute necessity if you’re a homeowner because it will:
- ensure your family always has a roof over their heads
- provide you with peace of mind, knowing your loved ones will be taken care of in case of your death or illness
- allow them to spend your insurance funds in a responsible and beneficial manner
- provide financial protection to your family
Flexible and Affordable Mortgage Life Insurance in Calgary
20/20 is Calgary’s first digitized paperless Mortgage Protection Product and has been designed to make mortgage life insurance as affordable, accessible, and simple as possible.
Want to know how we can protect your family and home?
4 Ways to Pay Off Your Mortgage Faster
Are you tired of making mortgage payments? It can be a huge drain on your budget, especially if the payments are eating up a large portion of your income. Not to mention all the interest you’re paying on the loan.
If you want to join the ranks of debt-free homeowners and shave thousands off your interest payments, here are 4 simple ways to pay off your mortgage early:
1. Pay a Little Extra Each Month
One of the easiest ways to shave years off your mortgage is to pay a little extra each month. Did you know: adding just one extra payment each year knocks four years off your mortgage.
Can’t do it in one lump sum each year? Break it down into smaller chunks with these two options:
- Divide your payment by 12 and add that amount to your monthly payment.
- Pay half your payment every two weeks (biweekly payments), which means you’ll end up making one full extra payment each year (13 instead of 12).
Tip: Check with your lender to see if they offer a bi-weekly payment program. Some charge a fee associated with the program, while others don’t.
2. Save For a Bigger Down Payment
When you’re buying a home, remember the old adage: if it seems too good to be true, then it probably is. ALWAYS avoid a no-money-down mortgage. A down payment gives you instant equity, keeps your monthly costs low, and reduces total accrued interest over the life of the loan.
It’s advised to put at least 10% down on your new home. BUT, if you can increase this amount to 20%, then you’ll be that much closer to owning your home outright!
3. Use ‘Unexpected’ Money For Your Mortgage
Have you ever received ‘surprise’ money such as a bonus from work, a tax refund, or inheritance? You didn’t expect that so you’ve budgeted to live without it: in other words, you don’t need this money.
While many people will spend this on little ‘extras’ such as a vacation, new home furniture, or more dinners out, applying that entire lump-sum to your mortgage could potentially shave years off your loan and make you a homeowner that much faster.
4. Refine Your Budget
If paying off your mortgage is one of your most important goals, then you may want to look over your budget and see if there is any extra money to pay down your mortgage. It’s all about prioritizing your spending to ‘find’ extra cash that is currently being used for something unnecessary.
You may want to start:
- carrying packed lunches to work
- taking public transportation to cut your gas costs
- rethinking your $4 morning coffee
- Cutting down on your subscriptions
- Overspending during your holidays
By creating better financial habits and being more aware of your spending, you can reduce any unnecessary expenditures and redirect them to your mortgage payments.
Building Your Household Budget
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To find out more how our affordable and flexible mortgage life insurance products can offer your family enhanced financial stability, contact us at 1-844-974-2020 or fill in our online contact form.
