Want to Cut Years off your Mortgage?
Asking a home owner if they want to cut years off their mortgage seems a superfluous question, but in reality many Canadians are not taking the simple step that would facilitate just that. The majority of Canadians accept the standard mortgage terms and make their monthly payments over 25 years. Most banks and lenders would prefer home buyers continue to pay their mortgage this way, as it means more interest revenue for them, but you can deviate from this norm and change your payment frequency to save money over the life of your loan.
Mortgage payments can be made as often as every two weeks or even weekly. By increasing your payment frequency, you can potentially save thousands of dollars and cut years off of your amortization schedule. Many banks and lenders offer accelerated payment schedules, but it is up to you to ask for more information. Our qualified professional mortgage brokers can answer any questions that you might have about increasing your payment frequency. Our brokers will also inform you of this option when helping you find the best mortgage option to suit your individual needs.
How does increasing my payment frequency actually cut years off my mortgage?
When you borrow money you are charged interest, or even a yearly charge, for the service. The interest is added to the original loan amount, or principal, and over time that interest accumulates. By increasing your payment frequency, you are paying off more of the original loan amount and incur less interest over time. This saves you money.
See the difference that increasing your payment frequency can make for yourself by utilizing our mortgage calculator to view various payment scenarios. CanEquity is here to put your increased payment plan into action.