 |
 |
|
 |
 |
| How about Bi-Weekly Mortgage Payments? Many loan servicers are offering an accelerated way for consumers to pay down their loans by allowing a biweekly mortgage payment option. Consumers can pay half of the total mortgage payment on a biweekly schedule. Usually these programs require the set up of a direct withdrawal from a personal bank account and most require a sign-up fee (as much as $300-400). For loans that do not have a prepayment penalty associated with them, prepaying down the principle balance of the loan can be a great way to gain and build equity. But, biweekly mortgage payments, or 26 half payments per year, function the same as making thirteen full mortgage payments per year, which is the same as making one additional mortgage payment per year. Unless the loan servicer is able to reduce the total amount of interest charged on the loan due to the half-mortgage-payment being received 10-20 days prior to the due date, it would seem that you would accomplish the same goal (less the direct withdrawal and without the sign-up fee) simply by making one extra payment per year, or by adding one twelfth of the mortgage payment (principle and interest) to each month’s payment, to be applied directly to the principle balance. You
should check with your current loan servicer for details. |
Tel: 770-418-1126 Fax: 770-418-9804 Email: info@hillsidelending.com |
