Our home planning centers:
Not much of the mortgage loan gets paid off in the first few years of your repayment plan.
|
||||||||||||||||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||||||||
In the illustration after 1 year, you only reduced your mortgage loan balance by: $1,228 Such a small reduction in principal forces you to pay mostly interest in the first few years of your repayment plan. In fact, after 60 payments (5 years), you have only reduced your mortgage loan balance by: $6,946. You still owe $93,054 on the original amount of $100,000. You must wait at least 18-23 years before you reduce your mortgage loan balance in half. |
||||||||||||||||||||||||||||||||||||||||||||||
Reducing the Loan Balance Fast You need to reduce the mortgage balance up-front in order to get more of your mortgage payment paying principal. For example, what if you made a $5,000 up-front payment: |
||||||||||||||||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||||||||
|
![]() |