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I have 12 years left on a 15 yr mortgage. I have been paying extra each month that is the total of 1 principle payment per year. How much should this reduce the term of my loan?
Wiki User
∙ 13y ago
It depends on your interest rate. If your rate is 5% the loan will be paid off 1.5 years sooner tahn the 15 year term, so term is reduced by 18 months, assuming you have been doing this from the beginning of the loan.
If interst rate is 7% term is reduced by about 22 months; at 4% by 17 months.
Wiki User
∙ 13y ago
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How many years do you reduce if you make two additional mortgage payments a year?
That would knock about 8 years off a 30-year mortgage; but I wouldn't save up money for lump payments twice a year -- just add the amount you're saving to the monthly payment instead. That'll pay it off a little faster. See the related links for a calculator that'll let you play with different scenarios; there are many similar web pages, if you search the internet for "mortgage calculator".
3 steps which will reduce the principle agent or agency problem?
1-Threat of job loss 2-Shares/stock offering 3-Monitring
What is interest curtailment?
From a financial point of view, I think only the idiot at Bank of America who decided to implement this word in there statements will really know. The only possible conclusion I could come to is "to reduce one's liability or outstanding debt, by making a payment." Hope I am close.
How do you reduce the ratio 707 to 999?
It doesn't reduce.
What does is mean to reduce something?
reduce something is to make the amount of something smaller. For example you can reduce your electric bill by unplugging the refrigerator.
How to cut down the years of 30-year mortgage?
You can refinance the mortgage. You can pay additional principle each month. This will reduce the overall cost of the mortgage. By paying double the principle amount each month, you eliminate a payment at the end of the mortgage time.
How much money and time do you save paying an extra monthly payment to principal on a 15 year mortgage?
In general you will reduce the payment by one month for every month's principle you pay ahead. It would take about 8 years. There are many online mortgage amortization calculators available. You will need also the percentage rate.
What is a bi-weekly mortgage calculator?
It is a mortgage where you can pay of more on your outstanding mortgage.If you have a cash sum you can make a bigger payment to reduce your mortgage thus paying less interest and reducing the term of your mortgage.
Can 1 extra principle mortgage payment per year reduce a 30 year loan to a 15 year loan?
1 extra mortgage payment..principal & interestcan lower your term to about 19 years.
What is the best way for one to reduce mortgage payments?
The best way to have a mortgage payment reduced is to make sure you pay your mortgage payment on time every month or earlier if you can. You can also double up on payments and then contact lenders about a lower payment loan.
When a borrower makes a regular monthly payment to their primary mortgage the amount of the payment that is applied by the lender to reduce the outstanding balance is called what?
PRINCIPAL :)
When paying a lump sum off your mortgage in order to pay it off quicker do you ask for it to be taken off the capital or off the term?
Any additional payment on your mortgage is applied to the principal. This will effectively reduce the term because the loan will be satisfied earlier if regular payments continue to be made.
What would be preferable to retire a loan towards the end of its term or much before?
The earlier you can retire a loan, the more money you will save in interest. Assusming it's simple interest, in the first years very little of the payment is going to reduce the principle. Toward the end of the loan term, most of the payment is going to principle and very little to interest, so the benefit of paying it off early at that point is limited. On a long term loan like a home mortgage, you may find that over the course of the first year, the principle goes down by about the amount of one month's payment. That means that if you can pay the equivalent of one month's payment extra toward the principal, you will have reduced payoff time of the loan by a year.
How does a loan modification impact the original loan?
The purpose of the loan modification is to renegotiate the terms of the original mortgage agreement. The objective is to ensure that your monthly payment is affordable. Consequently, your Lender may reduce some portion of your principle mortgage balance, extend the term of the loan, allow for a balloon payment at the end of the loan term, and/or lower the interest rate on your current loan going forward.
Will the mortgage company offer to reduce your mortgage due to the mortgage crisis?
Some banks will - the best thing to do is call your mortgage company and see what they are offering. Banks make more money by keeping you in your house and paying your mortgage, so you may be able to refinance or renegotiate the terms of your mortgage.
How does the down payment affect a mortgage?
A down payment will reduce the principal borrowed which lowers your monthly payments. A large down payment may also help lower your interest rate and may help you avoid paying PMI. If, for example you were buying a $200,000, at 5% for 30 years, the payment would be $1073.64 per month. If you put 10% down, or $20,000, your monthly payment would be $966.28 and you would save about $20,000 in interest.
Can you really keep paying principle payments towards your car loan and reduce interest?
By paying down the principle you decrease the amount of interest you pay on the loan. This will save you considerable on interest charges over the life of the note. If you simply pay an additional amount on the loan each month, over and above the required payment amount, you will also pay the loan off in a shorter period of time.
