If you’re a homeowner in Canada, you’re likely familiar with the joys and responsibilities of owning your own home. One of these responsibilities is paying off the mortgage on your home. Paying off your mortgage early can be a great way to save money in the long run, and it’s a goal that many people strive for. Here are some of the best strategies for paying off your mortgage early in Canada.
- Make Bi-Weekly Payments: Making bi-weekly payments can be a great way to reduce your mortgage debt faster. By making payments every two weeks instead of once a month, you’ll be able to make an extra payment each year. This extra payment will go directly towards the principal, reducing the amount of interest you’ll pay over the life of the loan.
- Increase Your Payment Amount: Making an extra payment each year isn’t the only way to reduce the amount of interest you’ll pay over the life of the loan. Increasing your monthly payment amount can also help you pay off your mortgage faster. For example, if you increase your payment by just $50 each month, you can reduce the life of your loan by up to four years.
- Make Lump-Sum Payments: Making a lump-sum payment to your mortgage can help you pay off your loan faster. If you have the money available, making a lump-sum payment can be a great way to reduce your loan balance and save on interest payments over the life of the loan.
- Refinance Your Mortgage: Refinancing your mortgage can be a great way to reduce the amount of interest you’ll pay over the life of the loan. Refinancing can also help you save money if you’re able to get a lower interest rate. If a lower interest rate isn’t available, you can still benefit from refinancing by switching to a shorter loan term.
Paying off your mortgage early in Canada can be a great way to save money and reduce your debt faster. By following these strategies, you’ll be able to reduce the amount of interest you’ll pay over the life of the loan and pay off your mortgage faster.