Can splitting mortgage payment help you shave 10 years from 30 year loan?

[DCRogers]

You can do a lot a pre-payment experiments yourself online, with calculators such as http://www.bankrate.com/brm/mortgage-calculator.asp. (I used $100K, 6%, 30yr fixed).

So, how much does paying half of each payment half a month early speed things up? Let’s simplify: make a full extra payment at the start; this is the same as paying all of each payment a full month early. How much time does this take off the loan? About 5 months — not bad for a single payment, but not a multi-year miracle, either.

Adding 10% extra to each payment shaves off about 6 years; 20% shaves off 10 years. If you’re looking to pay off early, such a habit is the way to go. Keep it simple, don’t look for miracles in software or complicated schemes.

(Just keeping track of twice the number of payments over 30 years would drive me nuts, and would make the 5-month savings not worth it to me!)

[DCRogers]

You can do a lot a pre-payment experiments yourself online, with calculators such as http://www.bankrate.com/brm/mortgage-calculator.asp. (I used $100K, 6%, 30yr fixed).

So, how much does paying half of each payment half a month early speed things up? Let’s simplify: make a full extra payment at the start; this is the same as paying all of each payment a full month early. How much time does this take off the loan? About 5 months — not bad for a single payment, but not a multi-year miracle, either.

Adding 10% extra to each payment shaves off about 6 years; 20% shaves off 10 years. If you’re looking to pay off early, such a habit is the way to go. Keep it simple, don’t look for miracles in software or complicated schemes.

(Just keeping track of twice the number of payments over 30 years would drive me nuts, and would make the 5-month savings not worth it to me!)

[DCRogers]

You can do a lot a pre-payment experiments yourself online, with calculators such as http://www.bankrate.com/brm/mortgage-calculator.asp. (I used $100K, 6%, 30yr fixed).

So, how much does paying half of each payment half a month early speed things up? Let’s simplify: make a full extra payment at the start; this is the same as paying all of each payment a full month early. How much time does this take off the loan? About 5 months — not bad for a single payment, but not a multi-year miracle, either.

Adding 10% extra to each payment shaves off about 6 years; 20% shaves off 10 years. If you’re looking to pay off early, such a habit is the way to go. Keep it simple, don’t look for miracles in software or complicated schemes.

(Just keeping track of twice the number of payments over 30 years would drive me nuts, and would make the 5-month savings not worth it to me!)

[NotCranky]

No offense meant to those posting on that thread, I’m aware the topic has drifted. But I guess I do feel pity for the poor suckers, wherever they may be, who paid the big bucks for that piece of software…

No problem …I just responded to you to see if I could sucker someone into putting their two cents in on the other thread…with attention to the current focus. I just wonder why software like that would cost as much as a loaded auto- cad for instance? If the program did work it isn’t very sophisticated technologically. It should be free.

[NotCranky]

No offense meant to those posting on that thread, I’m aware the topic has drifted. But I guess I do feel pity for the poor suckers, wherever they may be, who paid the big bucks for that piece of software…

No problem …I just responded to you to see if I could sucker someone into putting their two cents in on the other thread…with attention to the current focus. I just wonder why software like that would cost as much as a loaded auto- cad for instance? If the program did work it isn’t very sophisticated technologically. It should be free.

[NotCranky]

No offense meant to those posting on that thread, I’m aware the topic has drifted. But I guess I do feel pity for the poor suckers, wherever they may be, who paid the big bucks for that piece of software…

No problem …I just responded to you to see if I could sucker someone into putting their two cents in on the other thread…with attention to the current focus. I just wonder why software like that would cost as much as a loaded auto- cad for instance? If the program did work it isn’t very sophisticated technologically. It should be free.

[NotCranky]

No offense meant to those posting on that thread, I’m aware the topic has drifted. But I guess I do feel pity for the poor suckers, wherever they may be, who paid the big bucks for that piece of software…

No problem …I just responded to you to see if I could sucker someone into putting their two cents in on the other thread…with attention to the current focus. I just wonder why software like that would cost as much as a loaded auto- cad for instance? If the program did work it isn’t very sophisticated technologically. It should be free.

[patientlywaiting]

Adding 10% extra to each payment shaves off about 6 years; 20% shaves off 10 years. If you're looking to pay off early, such a habit is the way to go.

The key here is extra payments (more initial cash outflow for the borrower).  Simply making two payments won't cut it.  I think that Alex was looking for some "magic." 

Incidentally, I hear that some lenders refuse anything less then the full payment amount.  

 

[patientlywaiting]

Adding 10% extra to each payment shaves off about 6 years; 20% shaves off 10 years. If you're looking to pay off early, such a habit is the way to go.

The key here is extra payments (more initial cash outflow for the borrower).  Simply making two payments won't cut it.  I think that Alex was looking for some "magic." 

Incidentally, I hear that some lenders refuse anything less then the full payment amount.  

 

[patientlywaiting]

Adding 10% extra to each payment shaves off about 6 years; 20% shaves off 10 years. If you're looking to pay off early, such a habit is the way to go.

The key here is extra payments (more initial cash outflow for the borrower).  Simply making two payments won't cut it.  I think that Alex was looking for some "magic." 

Incidentally, I hear that some lenders refuse anything less then the full payment amount.  

 

[patientlywaiting]

Adding 10% extra to each payment shaves off about 6 years; 20% shaves off 10 years. If you're looking to pay off early, such a habit is the way to go.

The key here is extra payments (more initial cash outflow for the borrower).  Simply making two payments won't cut it.  I think that Alex was looking for some "magic." 

Incidentally, I hear that some lenders refuse anything less then the full payment amount.  

 

[Raybyrnes]

Daniel
I would not go buying the software youa re referring to but I am going to point out somewhting with respect to human behavior.

My wife wnet on a few diets and tried to do it on her own. It worked OK. She joined weightwatchers and paid money. She lost the weight and then got the luxury of not having to pay as long as she kept to her target weight. This is an empowering event. She gained control and simultaneously was penalized if she fell off.

Now you could easliy argue that she never needed to pay for weight watchers but the reality was that she was paying to achieve a certain outcome.

If someone who was disorganized about finances paid for a program and by paying were diciplined moving forward becasue they paid big bucks for a program than maybe they to achieved the desired outcome.

I am not going to judge as critically as others. Not everyone is good with finance or organized with their money.

[Raybyrnes]

Daniel
I would not go buying the software youa re referring to but I am going to point out somewhting with respect to human behavior.

My wife wnet on a few diets and tried to do it on her own. It worked OK. She joined weightwatchers and paid money. She lost the weight and then got the luxury of not having to pay as long as she kept to her target weight. This is an empowering event. She gained control and simultaneously was penalized if she fell off.

Now you could easliy argue that she never needed to pay for weight watchers but the reality was that she was paying to achieve a certain outcome.

If someone who was disorganized about finances paid for a program and by paying were diciplined moving forward becasue they paid big bucks for a program than maybe they to achieved the desired outcome.

I am not going to judge as critically as others. Not everyone is good with finance or organized with their money.

[Raybyrnes]

Daniel
I would not go buying the software youa re referring to but I am going to point out somewhting with respect to human behavior.

My wife wnet on a few diets and tried to do it on her own. It worked OK. She joined weightwatchers and paid money. She lost the weight and then got the luxury of not having to pay as long as she kept to her target weight. This is an empowering event. She gained control and simultaneously was penalized if she fell off.

Now you could easliy argue that she never needed to pay for weight watchers but the reality was that she was paying to achieve a certain outcome.

If someone who was disorganized about finances paid for a program and by paying were diciplined moving forward becasue they paid big bucks for a program than maybe they to achieved the desired outcome.

I am not going to judge as critically as others. Not everyone is good with finance or organized with their money.

[Raybyrnes]

Daniel
I would not go buying the software youa re referring to but I am going to point out somewhting with respect to human behavior.

My wife wnet on a few diets and tried to do it on her own. It worked OK. She joined weightwatchers and paid money. She lost the weight and then got the luxury of not having to pay as long as she kept to her target weight. This is an empowering event. She gained control and simultaneously was penalized if she fell off.

Now you could easliy argue that she never needed to pay for weight watchers but the reality was that she was paying to achieve a certain outcome.

If someone who was disorganized about finances paid for a program and by paying were diciplined moving forward becasue they paid big bucks for a program than maybe they to achieved the desired outcome.

I am not going to judge as critically as others. Not everyone is good with finance or organized with their money.

[Author]

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