Paying off your 15-year fixed-rate mortgage in seven sounds like a grand feat, but it is actually entirely possible. By using certain strategies and tips, you can cut that 15-year fixed-rate mortgage down to seven years and potentially even shorter. It all rests on your ability to stay focused, determined and consistent with your practices. The following debt management strategies are geared towards helping you remove all types of debt as quickly as possible. Once you join the ranks of the 29 million American Mortgage Free Homeowners, you will definitely look back and see the value your debt strategies have provided.
Debt Strategy #1: Biweekly mortgage payments
There are 52 weeks in a year, therefore making biweekly mortgage payments will yield 26 mortgage payments per year. This will help you pay your mortgage faster and avoid accruing unnecessary interest. Depending on your interest rate, this could allow you to pay your 15-year fixed-rate mortgage off in seven years. Sounds great right! Some mortgage lenders won’t allow you to make partial payments, others will not have an issue with it. Usually, you will have to set up the biweekly mortgage payments directly with your lender, or through an agency they determine. If your lender does not accept any payments lower than your total monthly mortgage, open another bank account and deposit your biweekly mortgage payments directly there. This is a great strategy that will help you join the ranks of a mortgage-free homeowner as fast as possible.
Debt Strategy #2: Make an extra mortgage payment every quarter.
If you can find the discipline to save, you may be able to make an extra mortgage payment every quarter. There are 4 quarters in the year, therefore this would require you to make an extra four mortgage payments per year. Looking at things in the long run, this will definitely speed up the time it takes you to pay your 15-year fixed-rate mortgage. For many people, this is easily possible. By making a few daily adjustments, you save the extra cash required to make those extra 4 payments per year. Be sure to let the mortgage company know you are sending this to pay for the principle, and not the interest.
Debt Strategy #3: Don’t Try To Live Like The Jones
You don’t have to try and keep up with the Jones’s at every turn. Just because your best friend or neighbors got a new 65 inch 4K curved 3D television, doesn’t mean you have to. You can settle for a much cheaper equally viable first-generation 35 inch LED TV. If this means paying off your mortgage faster, you should have no problem watching the games on a 35 inch compared to a 65 inch 4K curved 3D television. Not keeping up with the Jones’s also means eating home-cooked meals more often. You will be surprised how much money you spend eating out at restaurants twice or three times a week. You can easily save thousands of dollars by cooking your food at home rather than going out to restaurants. Reserve those occasions for a very special moment like an anniversary or birthday only.
Use the above three debt strategies to save money and apply it directly to your mortgage payments. The above tactics will definitely help you pay that mortgage off faster and help you join the ranks of the financially free.