How to Reduce Your Mortgage FAST With Only One Additional Mortgage Payment a Year

There’s a simple trick to significantly reduce the length of your mortgage and save you thousands of dollars.  The trick is to make one extra mortgage payment a year and apply that payment toward your loan’s principal. 

This is the method being used by “Bi-Weekly Mortgage Reduction Services” and “Bi-Weekly Mortgage Savings Programs”. Only, when you do it yourself, you don’t pay a third party unnecessary set-up costs and fees!

Example: $100,000 loan, 30-year mortgage, 6.5% fixed interest rate

Extra Mortgage Pymets/ Year Principal & Interest Additional Monthly Payment SAVINGS Total Paid # of Years
0 $632.07 0 0 $227,542.98 29.92 / 359 mos.
1 $632.07 $52.68 $29,088.02 $198,454.96 24.12 / 290 mos.
2 $632.07 $105.35 $28,399.71 $181,050.85 20.5 /
246 mos.
3 $632.07 $158.02 $58,320.95 $169,222.03 17.92 / 215 mos.
4 $632.07 $210.69 $66,969.79 $160,573.19 15.92 / 191 mos.
5 $632.07 $263.36 $73,607.77 $153,935.21 14.34 / 172 mos.


One-time Payment
It may not be possible for you to increase your monthly mortgage payment. Keep in mind that most mortgages will permit you to make additional payments to your principal at anytime. Perhaps, five-years after moving into your home you receive a larger than expected tax return, or an inheritance or a non-taxable cash gift.  You could apply this money toward your loan’s principal, resulting in significant savings and a shorter loan period.

With a $100,000, 30-year, 6.5% fixed interest rate mortgage loan, the borrower will pay a total of $227,542.98 to pay back the loan in 30 years. That equals $127,542.98 in interest payments.

If the same borrower makes a one-time $5,000 payment the first day of year 6, he/she will pay a total of $204,710.75 and pay off the loan in 27 years (324 months). That’s a savings of $22,832.23 in interest.

About luxpropertygroup

Lux Home Group consists of FULL TIME real estate professionals in the Phoenix area. Real Estate is not only our job, it is our passion. So, if you are interested in buying, selling, or renting a home in the greater Phoenix Metropolitan Area, or you would like to get involved in the fabulous world of real estate sales or investing, give us a call at 480.442.1442 or email us at If you just want to hang out with some super fabulous can call us for that, too.

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