According to the California Association of Realtors, homeowners wanting to pay off their mortgage earlier than planned can do so by making extra principal payments.
One extra full principal and interest payment a year will reduce a 30-year loan to about 17 years, and adding the following month’s principal payment to the current one will cut the loan almost in half.
It is important that borrowers tell their lender the extra money is to be credited to principal. Homeowners should keep records of their payments and review it once a year to be certain the lender has followed directions.
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