Mortgage pay down

[Jeff 232]

Anybody know a site I can see how fast I can pay down my home mortgage if I pay 1 or 2 extra payments a year

Not a mortgage calculator. I saw a site a long time ago that showed if you pay 1 or 2 extra principal payments a year a 30 year mortgage can be reduced by 6 years. I CANT FIND THAT SITE, ANYBODY. I dont want to be 75 when my house is paid of

If rates come down at all Im going to go to a 15 or 20 year mortgage

THANKS

Jeff

[PressurePros 249]

You are looking for an amortization calculator.

http://www.hsh.com/calc-amort.html

[James 625]

if you make two extra payments you will pay it off in less than 15yrs ?

[TNT Pressure Washing 14]

You might want to try bankrate.com . They have a lot of payment cals for everything.

[Celeste 341]

Jeff, I still have my loan program on my computer....I used to do the amortization for my customers all the time. I can plug is extra annual payments, additional $$ each month, etc... to let you know how many years you'll shave off doing extra :)

Celeste

Actually, some of the versions of Quicken have those amortization calculators built into them. Microsoft Money may have as well.

[squirtgun 122]

Quicken???Celeste are you kidding Jeff is still doing the big box of receipts.Quicken is far to modern for him.........lol.

[Jeff 232]

Quicken???Celeste are you kidding Jeff is still doing the big box of receipts.Quicken is far to modern for him.........lol.

Funny, but I use 5 finger typing now up from 3 a year ago

[mas3372 14]

http://www.stocktonturner.com/calcs/MortgagePayoff.html

This calculator is great. Type in your interest rate and how much extra you want to put on your principal and it will tell you how much you will save.

Keep in mind that if you want to refinance to save money, the interest rate change needs to be signifigant enought to save more money that what you accrue in new closing costs.

[mas3372 14]

I almost forgot. This calculator will not show you how much sooner you can pay it off. But lets say that adding 100 bucks per month to your principal will save you $45,000. Take that $45,000 and divide it by your montly payment now to give you a rough idea of how many months you drop.

[Jeff 232]

You are looking for an amortization calculator.

http://www.hsh.com/calc-amort.html

Thanks Ken, just what i was looking for. An extra $300 a month saves me almost 10 years off loan

Thanks everyone

Alright since you all can obviously help me.

Anybody know todays intrest rates, I know they have gone down some since I signed for my fixed rate

Im going to put out my #'s and give me some advise please. I'd like to shorten the length of my loan> My 30 year loan I'll be 75, not good, Im thinking a few different things, hope interest rates get down to around 6% and am thinking refinance for maybe 20 year fixed

Or just refinance at lower rate and do extra money each month, if the rates are lower than what I have

Built house 366K land 58K House appraised at $465K

Took my Fixed rate loan out for $275.000 - 30 year starting Dec 06 at 6.75% fixed, Monthly P&I $1783. The $1783 not a problem and can pay an extra $200 - $300 plus a month.

What are your thoughts on how to reduce my time of loan. I dont want to high a monthly payment just in case of tough times or something, thats why I like the idea of paying extra every month.

???????

Thanks in advance

JL

[PLD 14]

If you can, look into paying bi-weekly. 26 payments = 13 months. And 1/2 your payment was made 2 weeks earlier, so your interest bearing debt was reduced earlier. Over time, paying bi-weekly will save you years.

Just don't let your morgator scam you into paying a few hundred bucks for the "priviledge" of setting up bi-weekly. Many good mort companies offer it for free, many try and rip you off. If they try that crap, just send 'em more each month like you planned. Just make SURE and send two seperate checks. One for the regular payment, and one for the overpayment marked for principal. Otherwise they will either screw it up or apply it to work against you.

[Don M. 14]

I would just pay the extra 2-300 bucks a month and wait until the rate drops, maybe to 5.75 or so.

I am not 100% sure, but to refi for just .75, closing cost and such for the refi would probably not be a good idea. You will be suprised at what you would eat away at the principle with an extra 300 bucks a month, that is an extra 3600 bucks a year that would go straight to your principle.

Jeff, if you do send it in, make it out in a different check and write in the memo "to be applied to principal only" a lot of banks will take the check and apply it on the front end.

[mas3372 14]

I would just pay as much extra as you can now and if rates drop 1 percentage point or better, then consider refinancing. If you can pay an extra 300 per month now and pay it off in around 20 years, your current 30 year mortgage is a good as a 20 year with the benefit that if times get tough, you can save 300 per month.

[copgib 15]

Hey Jeff, What is a mortgage payment? I can assure you, once your loan is paid off it will be a great feeling. I haven't had a mortgage payment since May 2005. Believe me I sure don't miss it either! Good luck! Hugh

[Deck Guy 14]

If you can, look into paying bi-weekly. 26 payments = 13 months. And 1/2 your payment was made 2 weeks earlier, so your interest bearing debt was reduced earlier. Over time, paying bi-weekly will save you years.

Just don't let your morgator scam you into paying a few hundred bucks for the "priviledge" of setting up bi-weekly. Many good mort companies offer it for free, many try and rip you off. If they try that crap, just send 'em more each month like you planned. Just make SURE and send two seperate checks. One for the regular payment, and one for the overpayment marked for principal. Otherwise they will either screw it up or apply it to work against you.

I agree here. A very simple way to knock years off an existing mortgage. Do this and add $150 to every payment (instead of the $300 monthly), and you will be home free in no time!

[Jeff 232]

Thanks for the advise all, I'll check into the bi weekly and will send 2 checks, didnt even think about that. It would be nice to see rates come down to 5.75 too

Hope my biz goes great, Id like to pay this thing off in 10 years, I hate payments of any kind. I just paid of my couple credit cards and only keep one now. Just bought the wife a used 2004 Trailblazer paid cash and Im going to pay off my Ford this year a couple years early. Just trying to get all my payment wiped out for peace of mind. I hope in the next year or 2 to just have my mortgage payment and monthly home bills. I might be asking all you great guys for more advise, THANKS!!!!

thanks again

Jeff

[Celeste 341]

Jeff, consider what kind of deduction your mortgage interest is on your personal income taxes. With the way your income is growing, you may find you need every personal deduction you can get and a mortgage still is one!

Celeste

[bforbis 14]

Jeff,

Congrats on building a great business and getting things paid off. Celeste is right on about needing deductions. Have you considered max out of something like a 401K. For small business owners it is almost unlimited and invest in good quality stocks. They will more than pay for the interest you are paying for on your house loan.

I know a lot of people back away from stocks, and similar investments b/c of the unknown. The biggest part is get started putting $$ away, and work it like you work your business accounts and you will be set.

Just my humble $0.02 worth

[Jack Kramer 15]

Jeff,

Let’s say instead of paying your mortgage an extra $300.00 per month you invested the $300.00 in a mutual fund.

If the mutual fund averages an annual return of 6.75% it should be a wash as to which way is more beneficial. If the mutual fund does better than 6.75% there is more money in your pocket. On the other side if it doesn’t return 6.75% it is money out of your pocket.

Now let’s say 9 years from now some unforeseen financial situation happens to you. Your mortgage company will still want their payments on time. They don’t care that you prepaid your loan for 9 years. You could use the money invested it the mutual fund to make your payments.

As the years go on your mutual fund will grow and will eventually exceed your principal amount owed. At this time you can pay off the mortgage or use the money in the mutual fund to make your monthly payments.

Just a different way to look at your situation

[Jeff 232]

I was suppose to talk to my accountant about 401K this past year I kept putting it off, will take care of that this year. My wifes paychaeck we dont touch and we are investing that money and its a emergency fund for us.

I'll definitly talk to him about personal deductions. The house I will paydown, 75 is to old to be worrying about mortgage payments.

Thanks for all the great advise

JL

[mas3372 14]

Jeff, An emergency account is great, but don't let it get bigger than 6 months worth of bills. Throw that in a money market which will earn you about 3% and is readily available. The rest you be putting in IRA's or a 401k. Paying down your house is great, but if you are saving say $50 grand by doing so but the money used to save 50 grand could net you 100 grand by investing, thats the way to go. I would love to pay my house off and could throw an extra 800 per month on it but instead my wife an I invest that into a defferred investment. I could have my mortgage paid off in 15 years but would have nothing saved for the future.

Just my 2 cents

[Big Bill 14]

Jeff,

Find yourself a highly recommended certified financial planner (not a life insurance agent or stock broker - their goal in helping you is to sell you their product). Pay this person to sit down with you and come up with a financial plan for all of your future needs. The ideas that others have mentioned here are par for the course, but you will still need to ask qualified people for their help. I was recommended to a top notch guy years ago, he helped me with all kinds of needs, insurance, IRA account, company pension, etc. I have been set up on the bi-weekly mortgage plan for the last 5 years, it definitely reduces the number of years significantly.

Good Luck Dude!

One other thing, look into opening a 529 college tuition plan for your kids. It is a state sponsored program that is awsome. Most states have them now, do it now while your kids are really young, the earlier you start, the cheaper the cost.

[mas3372 14]

Jeff,

Bill's advise is probably the best. Pay someone a small fee to advise you in the best possible financial future. I did the same and this is what I based my advise on but then again, that fits my situation. I also have a 529 college fund account for each daughter with UESP - Utah Education Saving Plan. I live in Rhode Island but Utah's program is probably the best as far as fees and investment options go. Everytime my daugthers get money for anything, it goes into a savings account and every 3 months I send a check to UESP. When they are older they will get to play with it a bit. My wife and I also contribute every quater and investing now while they are young will make all the difference. Saving when they are teenages is almost pointless.