For many homebuyers, taking on a mortgage is an essential part of a process. A mortgage is helpful because it gives you access to more funds for buying a home in Irvine, but many people find they prefer to live debt free. Fortunately, it’s possible to speed up the process of repaying your mortgage and owning your home without any debt. There are a few different ways you can work toward eliminating your mortgage debt.
1. Make Payments More Often
Instead of paying a large amount once a month, consider splitting the amount in half and paying it to the bank every two weeks instead. Setting up a biweekly payment schedule can help you get rid of your mortgage quicker because it adds up to roughly 13 monthly payments each year. Paying an extra month of mortgage per year could cut off about 5 years on a basic 30-year mortgage. Depending on your lender, you may be able to enroll in a biweekly payment plan for free. Even if you do have to pay a fee for this option, it’s worth it in the long run.
2. Refinance Your Mortgage
If your financial circumstances have changed, it might be a good idea to go ahead and refinance your mortgage. You can get a new loan with more flexible terms or select a shorter option that lets you eliminate your mortgage debt more quickly. Being able to pay a higher mortgage each month means you will pay off your home much quicker. If you have at least 20 percent equity in your home, most lenders will drop the requirement for private mortgage insurance, which means you can save money by no longer making insurance payments and you can put more money toward paying off your mortgage.
3. Send in Extra with Your Mortgage Payment
Most people assume they can only pay the monthly mortgage fee, but many lenders will let you send in extra and put it toward the principal loan. Check with your lender to see how they will handle the extra payment before you do this, and keep rigorous records to avoid any confusion. If you can pay extra each month, it increases your available equity while reducing the amount of interest you will eventually have to pay. Even an extra hundred dollars each month can make a big difference over time.
4. Live Frugally
Most tips for paying off a mortgage rely on having extra money to pay off the debt with. If you want to eliminate your mortgage, you may need to take steps to set aside additional funds. If you truly care about getting rid of mortgage debt, you may want to budget more carefully. Little expenses like eating out, having weekend getaways, or buying the newest electronics add up quickly. Choosing to avoid unnecessary purchases ensures you have more money to get rid of your mortgage quicker.
When you need to take out a loan to purchase a house, make sure to consult a mortgage lender. If you’re looking to buy Turtle Rock, Irvine, real estate, reach out to Irvine Residential Living. Call 714-454-6304 today and get connected with one of our knowledgeable real estate agents to begin your search.