NFRC. I got a stray call from a credit card company and spoke to this woman

[florisandy]

that said as an example:

If you have a 30 year mortgage and pay half of your mortgage every other week, you can pay off your house in 15 years. Her point was that the APR starts all over again when you pay twice monthly. She said that the mortgage companies cannot stop you from doing this.

She also said that this type of payment plan can be applied to auto loans, credit cards, etc. and that a lot of people don't know about this.

She took me off of her call list. As I said, it was a stray call.

I haven't done any more research but it sure sounds feasible!

 

[marilynfl]

Not only feasible, but we did that. Make sure--FIRST--that the mortgage company

does not CHARGE for early payments. Some do. Also, you may need to specify that any additional money is to be applied to the PRINCIPLE.

When rates dropped, we had ours refinanced as a 15-year mortgage with twice-monthly payments to make it easier. Money just gets pulled out of checking every two weeks.

And, with 26 payments, two extra payments are made during the year that paying twice a month doesn't do.

Mortgage calculations for our situation:

$490 a month to pay off in 30 years.
S545 a month to pay off in 20 years
$592 a month to pay off in 15 years (biweekly payments of ~$300).

The money we saved NOT paying interest for an extra 15 years was something like $150,000.

 

[florisandy]

Aw, way cool that it can work and worked for you Mar!

 

[curious1]

Hi Marilyn, how are your tomato plants doing? Are they coping with the heat, humidity and rain?

 

[marilynfl]

Still alive, 2 med, 2 small, 1 teeny-tiny--all still green. But alive. Go figure.

 

[marilynfl]

And my mint seeds are finally coming up...after 2.5 months!