Reducing Your Loan Length - Extra Principal Payments
All right. Good morning, everybody. Shane here from Century 21. Don't adjust your channel! Got a new guy here. Thank you for joining our rotation. I got Mark Waterman from Great Western. He has graciously been, wanting to, or how should I say it, has asked to join our rotation and I appreciate it, it's always great to get another new, a new voice in our, in our group here so thanks, Mark, for joining us.
Yeah, appreciate it.
It is 8:15 and that means it's #18, of our Monday morning mortgage tip. And like I said, Mark Waterman from Great Western. I'll have all of his information either on the side, up above, down below, wherever you see it on that device of yours that you're looking at, feel free to reach out to him anytime. Reach out to me if you have any questions or even if you have a question specifically for us, we'd love to be able to answer it right here, on our next episode so, with that, Mark? What kind of tip do you have for us today?
Thank you, Shane, appreciate that. The mortgage tip that I was gonna bring to the table today is a little different, it's more on the back end, and more or less, it's, it's, knowing or did you know that making extra principal payments throughout the course of your loan can greatly reduce the length of the loan, and potentially save you thousands of dollars. So the scenario would be, you work with Shane, you buy a house, you now have this big loan you need to pay back, and you're so excited, right, to make this monthly payment, for 30 years of your life. 30. That, no, okay so anyway, We, how to shorten that, with the scenario and I went out and printed off an amortization table. Basically, $200,000 for 30 years at four percent, you're basically gonna pay $344,000 over the life of the loan, okay? So if you, if you can budget and you can figure out how to pay even a $100 a month extra onto that principal, you're going to cut roughly five years off and you're going to save about $26,000 in interest, okay.
I also did the same thing with, with even $50 a month, you still save about $15,000 in interest, and reduce it by just over two and a half years so, you know the benefits to it is obviously not only paying down your mortgage sooner, and paying less interest, but, but even if you don't stay in that house the entire length of the loan, you have more equity built up for maybe the next time you want to contact Shane, and go find a, you know, the next, the next big deal that you want to live in.
Perfect. Yeah, no, it's a, I don't think we've mentioned that before, obviously you start making payments and if you pay extra than what you're payment is, it doesn't take long to, save some money.
Absolutely.And so if you don't make that down payment up front, this is one way that you can, you know, you can pay it down quicker on the back end.
Perfect. So, great tip, thanks Mark. Excited to have you join our rotation and we'll get you going in this, be ready for our next tip in a few weeks. I appreciate it. Until then guys, thanks for watching, and next Monday we'll be at it again. Week and a half, I think two weeks, motor cross, super cross, don't forget that, I'll be giving some free tickets out, so keep your eyes open for that too. So thanks again, everybody, have a great week. Talk to you later.