Tips to Pay Down a Mortgage

Paying off a mortgage seems like a daunting task, but every journey of a thousand miles begins with a simple step.  Start your journey by making payments on time, every time. Never bite off more than you can chew, and this may be very possible.

Before rushing to pay off your mortgage, make sure there are no early payment penalties built into your contract.  Most conventional mortgages through Fannie Mae, Freddie Mac, and the FHA don't have penalties like this. If you arranged some type of private financing, however, it's possible you might have a pre-payment penalty. In that case, you should consider putting the extra "payment" into a sinking fund or money market, to be used in the future.

Pay off your mortgage by sending in more than the required payments each month. Sell some things online and put that money towards your mortgage to pay it off a little bit faster.  If you can provide even a little bit extra in each monthly mortgage payment it will go to principal, and help to pay down your mortgage that little bit quicker.

Need help finding a way to make that extra payment.  Look at your budget. Do you eat out often? The average family eats out 4-5 times a week. Figuring the average size of a family being 3.5 and the average meal costing $8.00 that's around $400 every single month. For a family with a mortgage that needs to be paid off $400 a month will go a long ways. The family might now be happy. You might crave those meals... but when the mortgage is paid it's all going to be worth it. If it's difficult cut down eating out by half for starters and go from there. Simple life choices can make profound financial impacts.

You can pay off your mortgage faster by setting aside any raises, merit pay, or bonuses you receive.  Some people use their tax return as extra payment and on a month with an extra pay period, they make an extra mortgage payment.  Put this extra money into the "mortgage fund" and pay the mortgage down.

Find ways to save money by not buying new things. Use the money saved to make extra mortgage payments. You may have friends who would rather have their fingernails plucked out with pliers than live frugally, and that's completely fine. As long as they give you a call when they are taking stuff to the dump, you should be fine with their lifestyle choice. Don't let things go to waste. Live frugally, save money, and become debt free.