Not Made Of Money

If you’re one of those few families who are lucky enough to have found your way out from under the mountains of credit card debt that plague so many people. You may be wondering what your next financial step might be. Free from monthly credit card payments, you have the opportunity to tackle the largest debt you will ever have: your mortgage.

You may be thinking that I’ve gone off my rocker. After all, who really pays off their mortgage? I don’t know a lot of people who own their homes free and clear, but it is certainly an enviable goal. Imagine how much more flexibility you would have in your monthly budget if you didn’t have to make a mortgage payment. You could treat yourself to a family vacation, save for your children’s college expenses, or even pay for some home renovations. The options are almost limitless!

First, though, you have to start paying down your mortgage. To help you get started, here are a few ways to start making a dent in your mortgage balance:

Round up your monthly payment. If your monthly payment is $780, you probably won’t notice the extra $20 required to bring your payment to $800. However, that extra contribution to your mortgage’s principal each month. For example, paying an extra $20 each month toward a mortgage of $130,000 could allow you to shave two years’ worth of payments off your mortgage.

Dedicate any “extra” money to your mortgage. Many employees receive an “extra” check when there are five paydays in a month. Since you weren’t counting on that paycheck to take care of your monthly bills, you can send the entire thing to your mortgage lender. Do you get a Christmas bonus from your employer? That would also be a great opportunity to send some extra money to your mortgage company.

Keep up your consumer credit payments after you’ve paid them off. You’ve already gotten used to having to send money to your credit card company or to making your monthly car payment. As you pay those debts off, you could very easily continue writing those checks each month; you’ll just send them to your mortgage company.

The most important key to paying down your mortgage, however, is making sure that your extra money is applied correctly. Write a note each time you send an extra payment asking the lender to apply the funds directly to your principal balance. Ditto for any incremental amounts you add to your monthly payment. In no time at all, you’ll start seeing your mortgage balance shrinking before your very eyes.

• A Review of Money Saving Ideas
• Three Key Ways to Motivate Yourself to Cook at Home

• Yes, We Paid Off The Tahoe Fans of the Dave Ramsey Show probably recognized that line...
• Debt Warning Signs and How to Get Out Over the past decade, an insane amount of debt has...