7 Proven Strategies to Pay Off Your Mortgage Early
The average homeowner pays more in interest than the original loan amount over 30 years. Here is how to cut years off your mortgage.
1. Make biweekly payments: Instead of 12 monthly payments, make 26 half-payments. This equals 13 full payments per year — one extra payment annually. Saves 4-6 years on a 30-year mortgage.
2. Round up payments: If your payment is $1,347, pay $1,400. The extra $53/month saves $22,000+ in interest and cuts 2-3 years off the term.
3. Make one extra payment per year: Use your tax refund, bonus, or holiday money. One extra payment saves 4-5 years.
4. Refinance to a shorter term: Moving from 30-year to 15-year increases monthly payment but saves massive interest. A $300K mortgage at 6% saves $240,000+ by going to 15 years.
5. Apply windfalls to principal: Inheritance, bonuses, tax refunds — every extra dollar to principal reduces your total interest.
6. Recast your mortgage: After a large principal payment, ask your lender to recast — keeps same term but lowers monthly payment.
7. Cut PMI early: Once you reach 20% equity, request PMI removal. Saves $100-300/month that can go to principal.
Calculate your savings: Mortgage Calculator