WASHINGTON – Plenty of homeowners are refinancing their mortgages to take advantage of lower interest rates. But just changing the way you pay your current mortgage can save you money.
Making extra mortgage payments can shorten the term of your loan and reduce interest costs over the years.
Some lenders offer biweekly payment plans. Typically the lender sets up an automatic debit from your bank account, drawing payments every two weeks. Because there are 26 two-week periods in a year, you wind up making 13 instead of 12 monthly payments a year.
If your lender offers a biweekly payment plan, the mortgage resource site HSH recommends you check the fine print. Any recurring transaction fees could eat away at your savings.