An Extra Mortgage Payment Puts Profits in Your Pockets

Want to put thousands of extra dollars in your pockets? Simple. Make just one extra mortgage payment each year for your Laguna Beach home. Then start planning your now-affordable dream vacation to Africa! (Ask me about my safari to South Africa.) It all boils down to simple math. An extra mortgage payment decreases the length of your mortgage and therefore lowers the amount of interest paid during the loan term. End of story.

Real Life Example   A 30-year loan of $500,000 at 5% gives you a monthly payment of about $2,684. Just one extra mortgage payment each year enables you to pay off the loan 3 years and 7 months early. Total interest savings on your Orange County property: a staggering $81,746! Now I ask you, could you use an extra eighty-one grand?

EZ Plan   What if you don’t have the funds to plunk down an entire payment? No problem. You always can go with the EZ payment plan – simply divide the one large payment into 12 manageable monthly installments. You’re still reaping tremendous benefits, only you’re getting them in smaller servings.

Timely Strategy   I can assure you, an extra mortgage payment for your home will have an even deeper impact on your wallet in the near future. As I pointed out in a previous article, a number of telltale signs indicate that home prices and therefore interest rates will be creeping upward very soon. I’m expecting prices to rise about 10% above the record-breaking lows we saw in 2011. The jump will affect a wide range of coastal properties, including Newport Beach homes for sale, Laguna Beach homes , Laguna Niguel homes, and Dana Point homes for sale. I’m telling you, it will happen. According to my calculations, the climb begins in 90 days.

Think Before You Pay  STOP! Don’t dash down to the bank hauling your extra payment just yet. You’ll first want to take stock of your personal situation. After all, you might discover better ways to utilize those greenbacks. For instance, re-channeling that money to pay off your highest interest loans first. Think about the mega-interest credit card debt that’s devouring your funds. It could be smarter to hammer down that debt first. You’ll have to do the math. You may also want to postpone making any extra payments until you’ve fully funded all your matching retirement accounts. Again, you’ll want to look at your situation to determine the best move.

Consult a Qualified Professional    If you opt to go the extra payment route, be sure to consult your lending institution first. The professionals there will show you how to make the payment and maximize your benefits.

If you’d like to learn more about the advantages or the process of extra mortgage payments, the Coastal Property Experts will be delighted to answer any of your questions. And, of course, we’re always on hand to help you discover the wealth of opportunities waiting for you in the Orange County real estate market.

Connect with our team at 949.922.8490 or hillary@thecoastalpropertyexperts.com. Until next time, Sunny Days and Smooth Sailing!

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