One of my lifetime goals, was to pay off my mortgage and live in my home debt free. I set that goal 20 years ago, and I achieved it 3 years ago. Paying off my mortgage, and all my debts, has been one of the best things I have ever done. Having no debt payments allows me to live quite comfortably on a small income, while being able to save for retirement.
Paying off a mortgage early isn’t easy. It takes discipline and the ability to look to the long term. But while surfing the net today I found an interesting tip that would be easy for most people to implement, and could take a few years off of your mortgage. It only works if you have an adjustable mortgage. With an adjustable mortgage your monthly payment is going to vary along with your interest rate. When your interest rate is higher you have a higher payment, and when your loan adjusts down, so does your payment. In an article titled “Borrowers can pay off mortgage early by keeping payments up”, the site, Money Magic suggests that when interest rates go down, and your mortgage payment goes down, you should continue paying the higher payment. By continuing to pay the higher payment (which you’ve already managed to squeeze into your budget!) even a relatively small interest rate drop can take years off your mortgage!