Mortgage Guide: Paying off Your Mortgage Faster

If you have found success in the Windsor real estate market you have gone from working with your Windsor REALTOR® to view a variety of houses for sale in Windsor, to finding a few Windsor homes right for you, to having an offer accepted, and finally closing on your home. Moving day has come and gone and finally you’re now onto everyone’s favourite part of homeownership, paying the bills! Specifically, those mortgage payments that will come at you each and every month. With good budgeting and money management you may have times when you want to accelerate paying your mortgage off. Well go over the ins and out of how you can pay your mortgage off faster.

If you want to make additional payments in order to accelerate paying off your mortgage, there are two options. The first option is to increase your payments. Even a small bump in the amount you pay per month can have a big effect on how quickly you can pay your mortgage back. You may have limits on how much you can increase it and when you can increase it depending on your mortgage contract. However, once you increase your payment, you typically can’t decrease it until the end of the term. Your term could be anywhere from months to years.

The other option is to make lump-sum payments in addition to your monthly payments. The amount of the lump-sum payment will also be set out in your mortgage contract. The contract may also stipulate when you can make lump-sum payments such as only at the end of a term, during certain parts of your term, or even as specific as certain days within the term as set out in the contract.

One phrase used often above is “as set out in the contract”. That is a very important aspect to paying off your mortgage faster. That is because your mortgage contract will set out rules for the both lump-sum payments as well as increasing your payments. You’ll have to operate within it’s parameters or you will be subject to prepayment penalties. It is important to read your mortgage contract carefully and before entering into an agreement understanding what your options for pre-payment are.

For more information about paying off your mortgage faster, CLICK HERE.

Here at Jump Realty our agents will give you honest advice on what course of action is best for you in their professional opinion and will always put taking care of your best interests first! With offices in Windsor, Tecumseh, Kingsville, and Chatham, no matter where you are, a Jump agent is ready to help. Please contact us for any housing needs and let us give you a better real estate experience!