By the time you enter retirement, you naturally want to be free from mortgage obligations. Sadly, many seniors still have mortgage debts.
According to statistics, more than 40 percent of 55 to 64-year-old homeowners, some 30 percent of 65 to 74-year-old homeowners, and around 14 percent of 75-year-olds and up still make mortgage payments.
You can keep yourself from falling into the same fate as these seniors when you enter retirement. You can make sure that, before you retire, you have completely paid off your mortgage. You can accomplish this by paying down your mortgage little by little through the years.
Many homeowners have done the same with their 30-year mortgages, paying them off within twenty, even fifteen, years.
Get the Amortization Schedule
You can use different strategies to pay down your mortgage as long as you consistently pay extra. One strategy involves acquiring the amortization schedule of your home loan. The amortization schedule lists the principal and interest amounts in each of your payments for the entire 30 years.
Once you have the amortization schedule, you can take a look at your next principal payment and pay for it ahead of time. You then skip one month’s payment in this way. Alternately, you can simply pay extra every year, and you can already save significantly in the long run.
You can even make bi-weekly mortgage payments to pay off your loan faster.
Know the Limit
Of course, before you can pay extra, however, you still have to confirm with your lender how much you can pay in advance towards your principal. You can especially benefit from this if you have a particularly high mortgage rate in your Utah loan you can get from lending firms such as Altius Mortgage Group.
By paying extra towards your principal, you save money that would have otherwise gone towards your high interest.
Paying down your mortgage frees you from mortgage debt sooner, saves you money, and allows you to get another mortgage for a new home down the road. As long as you consistently pay extra, you can have all of these benefits.