In a down or uncertain economy, the smartest thing you can do is reduce debt in all areas of your life. Paying off your mortgage loan sooner is one of the best things you can do for your financial future.
On the road to financial freedom, you’re going to have to make a few – no, a lot of sacrifices. Paying off your mortgage sooner will be worth the trouble, since the psychological and financial rewards of being mortgage-free are beyond words.
Here are some clever strategies to pay off your mortgage sooner and work on eliminating all debt.
Refinance your loan to a shorter time frame
If you have a 30-year mortgage, for example, you can refinance your mortgage to a 10, 15, or 20 year loan. Your monthly payment would increase, but you would be able to pay off your mortgage much faster.
Switch to biweekly payments
Biweekly payments allow you to make one extra monthly payment per year. Check to see if your bank has a biweekly payment plan available. This type of payment could reduce a 30-year mortgage by six years.
Make lump-sum payments
Whenever you get a larger amount of money, either from selling an asset, receiving a salary bonus, a tax refund, or the like, put this amount towards paying off your mortgage. Do this right after you receive the said amount, so you don’t have a chance to miss it or consider spending it.
Start paying more
If you want to start seeing real results, pay more each month towards your mortgage. Try not to underestimate the difference that this will make. Any amount is welcome, but try to outperform yourself each month. You can also consider rounding off your payments to make sure you pay more each month.