Refinanced my loan last month (went from 4.875 to 2.875% interest). Got all my paperwork and was setting up my online account with my lender so I don't have to mail in a payment.
Noticed my lender has a nice Amortization Calculator on their site. 20 year and 30 year notes had the same interest rate, so I went with the 30 year and planned to make extra payments. I plugged some extra additional principle payments into the calculator and wow! I knew they helped shorted the time on your mortgage, and lower your interested paid, but not by how much. On a $160k note, with 2.875% interest:
- If I run the note is full 30 years (360 months) I will pay about $79k in interest.
- If I pay an extra $100/mo towards principle I shave 68 months (5.7 years!) and $16.5K off my interest
- Extra $200/mo - 114 months off (9.5 years) and $27k less interest
- Extra $300/mo? Almost cuts the loan time in half - 147mo (12.15 years) and $34.5K less interest!
Again, knew it helped, but seeing HOW much it shortens the loan, and reduces the interest I pay was eye opening. Defiantly paying and extra every month.
Submitted August 19, 2020 at 08:45PM by TorturedChaos https://ift.tt/3hg8gbz
