1. Find out what your mortgage interest rate is. It should be on your mortgage statement. If your rate is higher than the market rate, the easiest way is re-finance your current mortgage. Brighten Lending offer many different programs to fit your need.
2. Compare your mortgage interest rate with your other investments. A 30-year-fixed-rate mortgage generally has an interest rate of 4% - 6%. Whatever you pay early toward your mortgage will effectively earn that rate of return. That is a good idea, especially for a risk-free investment. However, if you have other investments that are producing higher rates of interest, mortgage prepayment may not be a good investment for you.
3. Check if there are any prepayment fees included in your mortgage agreement. Prepayment fees change from loan to loan. Loans guaranteed or insured by federal government agencies cannot include prepayment penalties.
4. Look carefully at your budget and decide how much you can afford to pay toward your mortgage. Remember that although your house is a good investment, it is also an non-liquid investment--hard to cash into if you need money fast.
5. Call Brighten Lending and ask how to accelerate the payment of your mortgage. This can be done in a number of ways. You can ask to pay your mortgage biweekly, which will give you an extra payment every year (our web site did have a bi-weekly calculator). You can also pay a fixed amount; i.e. a percentage of your wage, or a fixed dollar amount every month toward your mortgage's principal on top of your monthly mortgage payment. Alternatively, you can prepay lump sums on your mortgage when you receive a gift, IRS Tax Refund, Year end bonus, an inheritance, or when you cash in on an insurance and/or investment plan.
6. Confirm your prepayment request in writing. Check your mortgage statement and confirm your prepayments go toward paying down the principal of your loan. Again, you are more than welcome to call Brighten Lending for help. We always here to help you to reduce your mortgage cost.