Resolve to pay your mortgage off faster
March 15, 2017 | Posted by: Natalie Wellings
With the New Year just beginning, there's no better time to set some goals for the year ahead. But while health and fitness tend to be top-of-mind these days-particularly after the food-fest known as 'the holidays'-it’s important to show your mortgage some resolution love as well.
One way to do this is to simply pull out that mortgage contract, blow off the dust and figure out when it's time to renew. If you're up for renewal in 2017, get the ball rolling early by locking down one of today’s low rates as early as possible-usually 120 days before your mortgage expires.
If you're not up for renewal, there are still ways to save some money (at least, in the long run) by paying down more principal. You can do this by making a lump-sum payment, or increasing your monthly payments. These payments don’t have to break the bank! Rounding your payment up to the nearest even number-or putting a portion of your bonus towards it-can save you hundreds of dollars over the life of your mortgage.
With rates expected to increase in response to recent mortgage rule changes, chances are the low rates you're used to today-whether they’re variable or fixed-won’t last forever. To prepare yourself-and pay down some extra principal-why not set your payment to mirror today’s 'stress test” rate, which is typically two percentage points higher than the posted five-year fixed rate.
There are countless other steps you can take this year to shorten the length of your mortgage. If you’d like to hear more, feel free to give me a call or send me a note.