pay off mortgage quickly

How to Pay Off Your Mortgage Quickly

If you are a homeowner, your mortgage makes up a considerable amount of your monthly expenses. Paying it off quickly will not only save you on expenses, it will also save you on the interest that accrues over the years.

Fortunately, there are several ways you can pay off your mortgage quickly. Read on to find out about a few that might work for you. 

Can You Pay Off your Mortgage Early?

Some may try paying their mortgage off early by saving on other expenses to apply more to their principle every month. However, not every mortgage company will allow this. 

Therefore, it’s important to check with your mortgage company first. Make sure they will not charge you any prepayment penalties for additional payments.

If your mortgage company allows you to make additional payments, make sure they know you are applying them to your principle. You can do this by making a note on the check you send them. If you don’t include this note, they may apply it to future payments which include interest. 

Finally, avoid mortgage accelerator programs. For the most part, they won’t offer anything that you can’t do yourself.

Bi-Monthly Mortgage Payments

The idea of a bi-monthly mortgage payment is to pay half your mortgage every two weeks. By the end of the year, you will have made 13 payments instead of 12. This will start to add up and it can knock up to eight years off a mortgage depending on the interest rate. 

To set up bimonthly payments, all you need to do is take the principle and interest payment amount and divide it by two. The taxes and insurance will have to be paid separately.

However, not all mortgage companies will process payments on a bi-weekly basis while others will charge you a pre-payment fee to do so. Do not agree to pay pre-payment fees. A pre-payment fee will add to expenses negating any benefits of paying off your loan early.

If your mortgage company does not agree to bi-monthly payments, you can also deposit half your payment into a bank account on a bi-weekly basis. Then use that bank account to make mortgage payments when they’re due. 

Make an Extra Payment Each Quarter

If you are able to pay off your mortgage early, making even one extra payment a year will help bring down interest rates. 

If you are able to make an extra payment each quarter, it will be even better. Making an extra quarterly payment on a $220,000 home with a 30-year mortgage and 4% interest will cut 11 years of your mortgage and save you $65,000.

Bring Your Lunch to Work

Bringing your lunch to work may be a bit of a grind but it can save you about $100 a month. If you apply this same $100 to your mortgage, it can save you close to $28,000 of interest on the $220,000 home described above. 

Similarly, you can opt for coffee from the office or from home to save on Starbucks expenses. With most people spending $3 a day in coffee, this could mean a savings of $90 a month. Apply that to your mortgage and you can save $25,000 in interest and cut four years off your loan.

Look for other little ways to save money while you’re at it. Even paying an additional $20 a month can pay off big resulting in a savings of close to $7,000.


Another way to pay off your mortgage faster is to refinance to a 15-year loan that’s no more than 25% of your take home pay. Paying your loan off in half the time will save you a considerable amount of interest. 

If your loan already has a good interest rate, you can just pretend you refinanced to a 15-year loan by doubling up on your payments. If you can pay your mortgage off even sooner than that, go for it. 

If you don’t have a good interest rate, you can refinance to find a loan with a lower interest rate. However, refinancing comes with its share of closing costs and administration fees that can add up to thousands of dollars. Make sure it is worthwhile before taking the leap. 


Downsizing is a major step but it can save you a considerable amount of money.

If you are able to move to a smaller, or less expensive, property, you can use the money you make off the sale of the first home to make a considerable down payment on your new home. In some cases, you may even be able to pay for your new home outright.  

Find a Home You Can Afford

Before buying a home, make sure that you can afford it. Make sure you are out of debt and that the payments won’t be more than 25% of your income. Make sure you can cover the down payment as well as any moving expenses, closing costs, repairs and utilities. 

If you can afford a 15-year mortgage or pay off a decent amount of your down payment, that’s even better. 

You may even want to hold off on buying a home until you have enough money to pay for it in cash. 

Eliminate PMI

PMI is Private Mortgage Insurance. It’s an extra fee tacked on by your lender to protect them if you don’t make your payments. 

A PMI is only charged to homeowners who can’t make a 20% down payment on their home. 

One way to avoid this fee is to make sure you have enough to make a 20% down payment before buying. 

If you are already dealing with a PMI, you can make extra payments to get 20% equity in your home and eliminate them. Once this happens, be sure to let your bank know so you are not paying more than you need to be. It is common for banks not to keep track of these payments and to continue charging customers even when they shouldn’t. 

Have Your Property Reassessed

Property taxes fluctuate. If the current rate is lower than what it was when you moved in, you could lower your monthly payments. 

The best way to get an assessment is to go through an agent. They will be able to compare your home with other properties in your area to determine whether you might be eligible for a reduction and unlike private companies, they will not charge a fee for this service. 

If the agent determines that rates have gone down, call your tax assessor. They will then send you form to fill out and send in. After reviewing the form, they will determine if your home is worth re-evaluating. 

If you can get your taxes lowered, you can begin putting more money towards your mortgage. It will also lower your overall payment if taxes are included in your mortgage.

File for Property Tax Exemption

Some states offer property tax exemptions for homeowners that qualify. Your eligibility will depend upon how long you live in your property, your personal situation and of course, whether or not your state has them available. 

You can do a Google search or contact your local tax commissioner to find out if you’re eligible. Veterans, senior citizens and disabled individuals are typically more likely to meet property tax exemption requirements. 

Recast Your Mortgage

If you are able to pay a lump sum on your mortgage, you may be able to work with your mortgage company to recast your loan. For a fee of about $250 many companies will reamortize your loan so the terms of the loan remain the same but the monthly payments are lower. 

However, different companies have different requirements for recasting. Some will require a $10,000 payment while others require $5,000. In order to get the process in motion, you will need to apply the extra money to the principle when you make your mortgage payment. 

Mortgage payments can be quite expensive. Fortunately, there are many ways for you to pay off your mortgage quickly to lower payments and even live mortgage free. Which option will you choose?