Owning our own home is called the “American Dream.” But, do you ever own your own home until you pay off your mortgage? Paying off the mortgage early is a goal that many homeowners strive for.
On the one hand, with the increase in inflation, the 30-year fixed mortgage rates have spiked to above 5%, making monthly payments unaffordable. Individuals are wondering is now a good time to buy a house and considering postponing the home buying process.
Homeowners need to create a budget that has to be strictly followed. A budget will tell you where the money has gone each month and where you must make changes to pay off your mortgage in five years.
Figure out how much house you can afford. If the house payments take up half of your paycheck, you will have difficulty paying for necessities, especially if you have a high debt-to-income ratio.
Making additional payments to the principle of the monthly payment will help shorten the length of the mortgage loan. Additional payments on the principal will save money since the homeowner would be effectively shortening the loan term.
That is probably one of the best ways to pay a mortgage quicker. A mortgage company can offer potential homebuyers a low down payment to get them into a new home sound enticing.