5 Tips to Save Time and Money as
You Own Your Home
Most of us dream of the day when we own our home outright. Here are
smart yet simple strategies that can help you pay off your mortgage
faster, for less cost.
1. Make your regular
mortgage payments more frequently.
Save interest by switching from a
monthly to a bi-weekly or weekly payment. This will have the effect
of making an extra monthly payment every year, without even noticing
it.
2. Choose the shortest
amortization period and the largest payment amount you can afford.
Slightly higher payments will
quickly become a routine budget item. The chart below shows that
paying $71.54 more in monthly payments for a mortgage of $100,000 at
6.25%* interest rate, would produce savings of $22,115.48 in
interest.
|
Amortization Term |
Monthly Payment of Principal and Interest |
Total Interest Paid Over Amortization Period1 |
|
25 year |
$654.74 |
$96,423.21 |
|
20 year |
$726.28 |
$74,307.73 |
3. Take advantage of
Scotiabank's 15% + 15%® prepayment privileges:
Increase your regular payment
amount. Once a year you can increase your payments by up to 15% of
the scheduled monthly payment amount.
Put any extra money, such as a tax
refund, into your mortgage. You can choose to repay up to 15% of the
original principal amount of your mortgage at any time during each
year of the term.
4. You can also Match a
Payment®
By doubling your current mortgage
payment of principal and interest, as well as taxes if applicable,
on any regular payment date, you can pay down your mortgage
principal even faster, with no fee or penalty.
5. Keep your payments the same.
When you renew, your principal
balance is probably less and your renewal may indicate a lower
payment amount, if that is the case, then increase the payment to
what you were paying before. This extra will be applied directly to
your principal amount helping you pay off your mortgage faster.
