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Pay Off Loan Faster
You can pay off your loan faster in one of two ways:
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Refinance your 30-year loan to a 15-year loan.
By converting your 30-year loan to a 15-year loan, you can pay off your loan
faster, and reduce your total interest costs. However, you will pay a
higher monthly payment. Depending on whether interest rates have fallen,
and by how much, the increase in your monthly payment could be worthwhile.
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Make extra payments each month or year on your current loan.
If your loan does not carry a pre-payment penalty, you can increase your
monthly payment or make an extra payment each year. The amount in excess
of your monthly payment goes towards paying down the principal of your loan.
If you make an extra payment every year on a 30-year loan, you will pay off
your loan in approximately 18 years.
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