Hi,
I'm just wondering if anyone makes bi weekly mortgage payments and if they see it as worth the fees. In the plan our company offers you pay half your mortgage every 14 days instead of one monthly payment. This has potential for a large savings over time. I'm looking for pros and cons...it seems like a good deal but we plan to pay our mortgage off in the next few years...thoughts?
Thanks for the great responses...totally makes sense to just do it myself (I can set up auto dedustions at my bank for every 14 days...duh!)...sometimes the most obvious things don't present my cluttered brain these days...can't imagine why...LOL>
Check and see if you have a prepayment penalty. If not, you should be able to just extra every month labeled "apply to principle" and pay the mortgage off faster without paying any fees.
Here's an article about biweekly payments and some free options: http://www.bankrate.com/brm/news/mtg/20010920a.asp
I read the answers and you could have wonderful savings, but just be sure you know you will have the amount available that you need every fourteen days. I am not always certain I will considering what I do for a living. It's a little unpredictable.
Yes, bi monthy payments will cut an averag of 8 years off your mortgage saving you thousands of dollars in payments and interest. I know of a company that does not charge for this service which is awesome! You CAN do it yourself, however this program will pay off the loan even faster because of the way they apply the interest. You wouldn't be able to do that part on your own. If you are intersted, please contact me directly.
J.
I have gone that route and frankly speaking all you have to do is make your 1/2 payment every two weeks on your own. There is no need to pay fee's etc.. deductions from your paycheck are a convienence of using companys but with todays technology and on-line banking you can save even more money by not using those other programs. I even went so far as to increase my monthly payments, divided them by 4 weeks (even with 5 week months)and issued weekly payments to my mortgage company. This allowed me to pay off my home sooner, increase the equity in my home sooner and make extra payments without "missing" the money. Just a suggestion.
Good Luck!
You can always pay extra toward the pricinple of your mortgage to pay down the loan and save on interest. Why pay a fee for when you can put that money towards the loan? The only reason you save money on this program is because you are making extra payments over time- just make the extra payments.
It amounts to paying one extra payment per year and less interest. Do IT, like previous poster said, check on penalties first. But like all good intentions, paying it off in a few years may or may not happen in this economy. If I remember correctly you will pay off your 20 year mortgage in approx 15 and a 30 in 20. 5 to 10 years earlier is alot of savings that could go to your retirement!
