Grampa Posted November 20, 2017 Report Share Posted November 20, 2017 I heard a interesting comment today. It was mentioned that you could save yourself a substantial amount of interest on your mortgage if you opted to make payments 2 weekly instead of monthly. Apparently it is because the way interest is compounded. Has anyone else heard of this.? EDIT: Not being a mathematician but putting a bit more thought to it I think if it is correct it only applies to a repayment mortgage. But I could be wrong. Link to comment Share on other sites More sharing options...
Richlist Posted November 20, 2017 Report Share Posted November 20, 2017 No, but making even small overpayments on a mortgage will significantly reduce the amount of interest paid. The success of what you have heard will depend on the way your lender calculates interest. By paying some money 2 weeks early it probably means the full months interest due will be calculated on a reduced amount.....resulting in less interest. Link to comment Share on other sites More sharing options...
Melboy Posted November 21, 2017 Report Share Posted November 21, 2017 When I had a repayment mortgage and that was a long time ago but all calculations are relative I only had minimal savings but used to overpay my monthly mortgage and I finished with it 10 years early. My Kid's do the same with their mortgage. I would recommend this to anyone who has a mortgage to pay a small amount off extra every month. Repayment mortgage interest is calculated on a daily basis as far as I know. Link to comment Share on other sites More sharing options...
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