Mortgage Payment Options… Which is the best option for your situation?
Once your mortgage has been funded by your lender, you need to decide on how frequently you want to make your mortgage payments.
Most people want to pay off their mortgage as quick as possible to save on paying interest.
Below are a list of various mortgage payment options:
Monthly
Most people’s typical payment option. Monthly payments will have the lowest payments therefore your mortgage will be paid off the slowest. For many people this is the most comfortable options, since it’s only one payment a month to plan for.
Bi-Weekly
Take your monthly mortgage payment multiply by 12 for a year, then divide by 26. You will make a mortgage payment every 2 weeks for a total of 26 payments per year. This will not help to pay your mortgage off any sooner than regular monthly payments.
Semi-Monthly
You make payments twice a month for a total of 24 payments a year. This will not help to pay your mortgage off any sooner than regular monthly payments.
Weekly
Take your monthly payments, multiply by 12 for a year, then divide by 52 weeks. This will not pay down your mortgage any sooner than regular monthly payments.
Accelerated Bi-weekly
You monthly payments divided by 12. This option creates 2 extra bi-weekly payments a year, meaning you would be making 13 monthly payments a year (instead of 12). The two extra payments go directly to paying down the principle on your mortgage.
Accelerated Weekly
Your monthly payment divided by 4. This option created 4 extra weekly payments a year, meaning you would be making 13 monthly payments over a year (instead of 12). The 4 extra payments go directly to paying down the principle on your mortgage.
The size of your mortgage payment will depend on your down payment, the amortization period, the term, and your payment schedule. If you are unsure about what option would work best for you, contact one of our experienced Mortgage Advisors. Learn Before You Leap. They can help you answer this mortgage question and more. Please call Client First Mortgage Solutions today!
Original Article – Dominion Lending Centres – November 17, 2017
