How to pay off your mortgage faster without substantially altering your lifestyle

Most Canadian homeowners know that the longer they hold on to borrowed money, the more it costs as interest accrues. Knowing this fact, most mortgagors (borrowers) try to pay down their mortgage as quickly as possible --thus maximizing their interest savings.

Most mortgages offered by the mortgage lending partners at Alberta Mortgage offer substantial payment privileges to borrowers, allowing for lump sum payments as well as ongoing principal reduction. However, for most homeowners making large lump sum payments can be difficult and therefore rarely occurs. Instead, by following some of the simple strategies outlined below Canadian homeowners have saved tens of thousands of dollars in interest over the life of their mortgages.

1. Increase the frequency of your payments:
When choosing a payment scheme, make accelerated bi-weekly payments in order to get a "free" principal reduction which would be equivalent to one full mortgage payment every year, painlessly.

2. As income rises, raise your mortgage payments:
While disposable income is fun to spend, putting it towards your mortgage will save you a lot of money in interest payments which will be even more fun to spend in the future.

3. Round your payments up, instead of down:
Over time, by making even extra nominal payments of $20 to the principal, the amount of interest that you will be saving yourself from will amaze you.

4. If mortgage rates fall, don't reduce you payment scheme:
If so far, the payment amount has not been an issue of concern, then there is no benefit in reducing the payment amount if/when your mortgage interest rate falls. However there is a downside to reducing your payment being that interest payments will grow.

For more ideas on paying off your mortgage faster, visit www.albertamortgagecentre.com/tips.html or talk to one of the qualified mortgage professionals at Alberta Mortgage.

Alberta Mortgage
#78, 4003 - 98 Street NW, Edmonton AB T6E 6M8
P: (780)479-2222
F: (780)471-5981
web: www.albertamortgagecentre.com