How to Reduce Your Mortgage

How to Reduce Your Mortgage

One Additional Mortgage Payment a Year

There's a simple trick to significantly reduce the length of your mortgage and save you thousands of dollars. The trick is to make one extra mortgage payment a year and apply that payment toward your loan's principal.

^{There are some 3^rd party services out there touting this as a great way that they can save you money. The real story is you can save yourself money on you mortgage and money by not using the 3^rd party service if you will initiate this reduction yourself. This way you avoid unnecessary 3^rd party set-up costs and fees and substantially reduce the overall amount of money you pay out on your mortgage interest!
Example: $100,000 loan, 30-year mortgage, 6.5% fixed interest rate}

Extra Mortgage Payments/ Year	Principal & Interest	Additional Monthly Payment	SAVINGS	Total Paid	# of Years
0	$632.07	0	0	$227,542.98	29.92 / 359 mos.
1	$632.07	$52.68	$29,088.02	$198,454.96	24.12 / 290 mos.
2	$632.07	$105.35	$46,492.13	$181,050.85	20.5 / 246 mos.
3	$632.07	$158.02	$58,320.95	$169,222.03	17.92 / 215 mos.
4	$632.07	$210.69	$66,969.79	$160,573.19	15.92 / 191 mos.
5	$632.07	$263.36	$73,607.77	$153,935.21	14.34 / 172 mos.

One-time Payment

It may not be possible for you to increase your monthly mortgage payment. Keep in mind that most mortgages will permit you to make additional payments to your principal at anytime. As an example, perhaps, five-years after moving into your home you receive a larger than expected tax return, an inheritance, or a non-taxable cash gift. You could apply these funds toward your loan's principal, resulting in significant savings and a shorter loan period.

Example:

With a $100,000, 30-year, 6.5% fixed interest rate mortgage loan, the borrower will pay a total of $227,542.98 to pay back the loan in 30 years. That equals $127,542.98 in interest payments.

If the same borrower makes a one-time $5,000 payment the first day of year 6, he/she will pay a total of $204,710.75 and pay off the loan in 27 years (324 months). That's a savings of $22,832.23 in interest.

We are required by law to list the following licensing information. Flagship Financial Group, LLC is licensed as: Alaska Mortgagee Licensee #100278; Arizona Banker 0908193; Department of Corporations under the California Residential Mortgage Lending act Lender 4130854; Florida Correspondent Lender CL 0703188; Georgia Mortgage Broker Licensee 17297 – 3130 W Maple Loop Dr, #200, Lehi, UT 84043 (GA); Illinois Residential Mortgage Licensee MB6760204; Registered under the Kansas Mortgage Business Act License Number of 2002-4309, Maine Mortgage Lender License# SLM9424; Maryland Mortgage Lender 16461, Mississippi Supervised Mortgage Company 308/2006; Nevada Mortgage Broker 1385 – 1349 Galleria Dr., #110, Henderson, NV 89014; New Hampshire Banking Department Mortgage Broker 13439-MBR; North Dakota Money Broker MB101563; Licensed by the Pennsylvania Department of Banking (PA); Utah Mortgage Loan Company 5493106; Licensed by the Virginia State Corporation Commission, License MC-2980. In certain states in which we do conduct business, certain restrictions and limitation apply. Rates and terms subject to change. If you have any questions or comments regarding this offer please email to lharris@ffgcorporate.com.