Shortening the length of a mortgage can save you thousands of dollars:
Payments on a $150,000 mortgage, at 4.5% interest, paid over 30 years will be $760.03 a month, principal and interest.
Adding another hundred dollars a month to the payment, bringing it to $860.03, shortens the length of the mortgage to 23.7 years, and saves you $57,762.13.
By doing a bi-weekly mortgage, the payment would be $380.01 every other week. The mortgage would be paid off in 25.6 years, saving you $21,025.19 in interest payments.
The payments on a $150,000 mortgage at 4.5% for a 15 year mortgage would be $387.00 per month higher ( $1,147.49) but the mortgage would be paid off in half the time.
Another advantage of shortening the length of time on a mortgage is that you will be building equity faster than you would on a 30 year loan.
I hope you find this helpful. I am here to help you with all of your real estate needs. Barbara Blanchard, Broker Associate, Keller Williams STFL Ithaca, 607 351-1273. firstname.lastname@example.org