I’m trying to figure out if making one extra payment each year can really cut down a 30-year mortgage to just 17 years. Here’s what I’m wondering about:
Let’s say we have a $315,000 mortgage with a 6.62% interest rate. Is it true that one extra payment per year would make such a big difference? And if so, how much money would we save overall?
I’ve heard people talk about this trick, but I’m not sure if the math checks out. Has anyone here actually done this or know someone who has? It seems almost too good to be true, but I’m really curious to learn more.
Also, if this works, are there any downsides or things to watch out for? I’d appreciate any insights or experiences you can share. Thanks!
I’ve actually run the numbers on this scenario. While making an extra payment annually can significantly reduce your mortgage term, cutting it from 30 to 17 years is a bit optimistic. Based on the figures you provided ($315,000 at 6.62%), one extra payment per year would likely reduce the term to around 24-25 years, saving you approximately $100,000 in interest over the life of the loan. It’s still a substantial benefit, but not quite as dramatic as 17 years. The key is consistency - you need to maintain those extra payments throughout the loan term to see the full effect. Just be sure you’re not stretching your budget too thin to make those additional payments.
hey ella, i’ve heard about this too! it can def make a big diff but maybe not quite 17 yrs. the extra payment goes straight to principal, so it cuts interest over time. but 13 yrs off seems high tbh. might wanna double check those numbers or talk to a mortgage pro. still, extra payments are usually a good move if u can swing it!
That’s intriguing, Ella! Have you considered other strategies to pay down your mortgage faster? What about bi-weekly payments or increasing your regular monthly amount? I’m curious how those might compare to the extra yearly payment. Anyone here tried different approaches?