Mortgage loan insights
Whether your goal is to lower your monthly payment or to save money on the total cost of your home mortgage, mortgages offer you several ways to achieve your goal. The first decision you have to make is, do you want to reduce your total payment or your monthly payment? These goals are opposed. Because interest compounds, making a lower total payment means making a higher monthly payment, and making a lower monthly payment increases the amount of money you will eventually pay to your lender. If you want to save money by lowering your total payment, the answer is simple: Add a little extra to your monthly payments. The extra money goes directly to your principal, so in the next month you accrue less interest and pay off more principal, which drops the following month's interest even more.