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| Thread ID: 82959 | 2007-09-14 05:36:00 | Paying of Mortgage Quicker? | xpcoe (12594) | PC World Chat |
| Post ID | Timestamp | Content | User | ||
| 591114 | 2007-09-14 05:36:00 | I have question relating to paying Mortgage quicker to save interest I pay mortgage monthly which is currently fixed for 10 years and then to adjust to floating thereafter. If i were to pay make payments every 4 weeks instead of monthly i get extra set of payment end of the year. And if i were to make payments bi-weekly, instead of 4 weekly would this save more in interest or it doesnt matter?? |
xpcoe (12594) | ||
| 591115 | 2007-09-14 05:44:00 | It won't pay your mortgage off faster by making the payments weekly or fortnightly, but it might make them easier to manage although if you up the payments you make then you will pay your mortgage off faster. | winmacguy (3367) | ||
| 591116 | 2007-09-14 06:15:00 | I have question relating to paying Mortgage quicker to save interest I pay mortgage monthly which is currently fixed for 10 years and then to adjust to floating thereafter . If i were to pay make payments every 4 weeks instead of monthly i get extra set of payment end of the year . And if i were to make payments bi-weekly, instead of 4 weekly would this save more in interest or it doesnt matter?? xp if your mortgage payment is due every month and is fixed like u say for 10 years, then paying the same amount every 4 weeks that you normally pay monthly will make that extra payment per year i . e you have 13 payments every year so Yes u are paying off your mortgage that bit quicker . For bi-weekly payments it probably doesnt pay off any quicker compared to 4 weekly since they both end up making 13 payments per year and since interest is compounded monthly i think . . . i might be wrong this one but maybe someone can clarify on this aspect |
learning (5137) | ||
| 591117 | 2007-09-14 08:48:00 | You are on the right track and I've been advising clients for 20 years to do fortnightly mortgage payments. It effectively means another months payment per year. You need to talk to your bank because you have a fixed interest loan. Altering the payments is altering the loan and there is no point if you don't get a benefit. As to when the interest stops running - that is a matter of how the bank calculates it's rest periods. Many banks these days calculate interest daily in which case the interest reduces every fortnight if you make fortnightly payments. It used to be that mortgages had monthly, three monthly, or even annual rests which meant a lump sum paid on 1 January was of no benefit until much later in the year. Talk to your bank. :D |
Winston001 (3612) | ||
| 591118 | 2007-09-14 11:06:00 | I have fixed mortgage which I changed to fortnightly for this reason that any extra payments means less interest, also I can pay additional dollars (approx $6000 per year) with no penalty which just knocks off another year or 2 at the other end. | sam m (517) | ||
| 591119 | 2007-09-14 11:15:00 | Other ways of reducing mortgages are to make part of the loan floating on a flexi type account and use this instead of a cheque account. Every dollar in saves on interest payments whilst it is in the account. Also using visa for as many bills as possible and paying it off monthly. Be warned though. This works if you are good with money, but is a recipe for disaster if you aren't. |
Mercury (1316) | ||
| 591120 | 2007-09-14 20:08:00 | www.sorted.org.nz | pctek (84) | ||
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