Every Monday Morning at 8:15am, join me on my Facebook page as I sit down with a local lender, and do a live interview and talk about a Mortgage Tip that may help YOU with your next Real Estate Purchase.
This morning I sat down with Mark Waterman from Great Western Bank. Listen in as Mark gives a brief explanation of the benefits to paying more on your principle with a 30 year loan. You can reach him at 605.627.0602 or Mark.Waterman@GreatWesternBank.com His office is located at 1302 6th St., Brookings SD 57006 or on the web at www.GreatWesternBank.com
Paying More on your Principle
- Good morning everybody, Shane here from the Brookings Home Team powered by Century 21. And again it's Monday morning, 8:15, ready to roll here. And got a familiar face. Yeah, it's only been a few weeks.
- Yeah two weeks I think.
- Scared the crap out of you last night.
- Said hey Mark, he said yeah lets get doing this. So we had to rearrange some of the schedule here a little bit, so thanks Mark for kind of adjusting yours.
- Yeah, no thanks for the reminder. Not used to doing it every two weeks.
- So we jumped in here and Mark graciously agreed to get on and talk about a tip here this morning. So as you guys are coming on please let us know, give us a heart, give us a thumbs up. And let us, or be sure to share, tag this video with anybody else you think would be interested in it. So, Mark, what's the tip for today?
- So the Monday Morning Mortgage Tip I wanted to talk about was making extra payments to the principle of your loan and what the consequences of that can be. So by no means am I a financial adviser. Certainly, money on your house and your mortgage is probably the cheapest money that you're going to borrow when it comes to your debts. But as far as paying that mortgage off, I kind of ran some numbers on a $200,000 loan over 30 years. Lets see your payments would be like $926 on principle and interest, and if you made an extra $100 a month payment towards the principle it would pay it off four years 10 months early and you'd save about $24,000 in interest over the life of the loan. Pretty substantial amount of shaving the life of the loan down to about 25 years compared to the 30. You know I've had some people that the 15-year rates have been pretty tempting, however, you it doesn't fit everybody's budget of course, it's a lot higher payment. So if you do go with the longer term it's one way to kind of combat that if you are looking to pay it off sooner than 30 years. So majority of people can probably afford an extra $100 a month compared to the 15-year mortgage.
- Sure. And you're not locked into that payment on the 15 year.
- If you're on that 30 year. And if you have a bad month you don't have to make that extra $100 payment.
- Exactly. You can always pay more, you can't pay less.
- Yeah, right. Otherwise they're knocking on your door.
- Yeah, exactly.
- You don't want that. But yeah, so that was about $24,000 that they would save over a 30-year term.
- Yeah $24,000 on interest, absolutely.
- Shrink your loan into about 24 year, 25.
- 25 years, yep.
- Something like that. All right, well that's a great tip there. And you know I can attest firsthand, that is something I do. I actually, my payment is X amount and I actually round up to the nearest 100 and that's what I've always done since day one. So we're getting close to getting her paid off.
- Absolutely, it makes a difference. It really does.
- And like I said, if you don't have a good month then you don't have to make that extra payment. But all right Mark thanks for that information. If you have more questions for Mark, please let him know. Feel free to give him a call. I'll have his information on the top, on the bottom or on the sides, wherever your device allows you to see that. And you certainly can direct message him too or give him a call like I said. If you have any questions for any of us for any future episodes let us know. Speaking of which, we're coming up to episode 100, I'm excited.
- What are we at right now?
- I think it's 97 or something like that, 96. So almost to 100 guys, it's pretty exciting. But thanks for watching. Have a great Monday. We will not be back next Monday, I will not be in town, but we'll be back here in two weeks. So let us know if we can help you guys out. We're ready to go. Have a great day. See ya.