Bi- Weekly Mortgage Payment Makes Life Easy

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It happens that I and my spouse purchased our lake home five years ago. During the period, we bought it the interest rates were about eight percent that lead us to enter a thirty year loan deal. Not quite long after we moved in the interest rates come down to less than five percent on fifteen years mortgages. I and my spouse were determined to refinance in essence, so that we could get the house loan paid off by the time of our retirement. We went through the refinancing procedures. Our loan representative recommended that we think about the bi weekly mortgage payment. He advised that this would permit us to pay off the fifteen year mortgage in about twelve years. My spouse was unconvinced so we decided that we would explore it before agreeing to this kind of payment plan. The loan representative also made it clear that our mortgage would be sold to a mortgage establishment anyway so we could ask for facts one we are aware which establishment would be taking over our mortgage.

We carried out some research assignment on bi weekly mortgage payment programs. This is how the arrangement works, by getting you pay your first complete loan payment for your home. You later pay half of the payment on the fifteenth of the month and another half fortnight after. After the first month you pay half the mortgage payment fortnightly i.e. every two weeks that is the reason it is called bi weekly mortgage payment or every two weeks mortgage payment. This procedures means that the first month, you are expected to make two payments, afterward, you have to make half payments two times a month. At all times, you are ahead a half payment in this way and you are paying off the interest quickly and even more on the main part of the loan and that is what speeds up the home loan. Using bi weekly mortgage payment plan, each check is smaller, therefore not a very huge amount is due at the starting of each month. All the payout arrangements that we check out revealed that we would be blocking off three year of mortgage payments and you know that translates to thousands of dollars in interest being blocked off.

We discuss the issue of bi weekly mortgage payment with a financial advisor and he agreed that this is a great comprehension idea. He said that you can achieve the same thing by making an additional house payment each year and also mentioned that this would speed up repayment of the home loan. By making an additional payment each year and instructing the mortgage establishment to remove the amount off the main, you are also cutting down the duration of the loan. We were informed that a lot of people prefer to go with the bi weekly mortgage payment so they do not have to remind themselves of paying the extra payment nor do they have to fathom out the time. The additional payment is most helpful and highly advantageous. We decided to move along with the bi weekly mortgage payment. It gives the impression that our main loan is moving down faster and our payments are getting reduced.