subject: Dealing with Home Mortgage: Should You Pay It Earlier or Not? [print this page] Dealing with Home Mortgage: Should You Pay It Earlier or Not?
Buying a home is usually acceptable because most financial experts consider it as good credit. A house is something that you really needed and once you are in a good financial ground, you may consider owning one for yourself instead of renting out. If you have already taken the plunge, you might be dealing with mortgage and questions whether you should pay it off earlier or stick to the 30 years duration. Not all financial experts agree on this issue, but you can be able to make a wise decision for yourself by weighing some factors.
Some people argue that paying your mortgage earlier than projected is a bad idea because you can use the money to invest in something else instead. This kind of amount can either be used for college funds or as a preparation for your retirement. You can also use it for increasing the value of the home you just bought by putting improvements. If you are in a stable position, you can take some extra funds and take a vacation. All these things are great, but you may prefer the benefits of early payments as well.
If you are going to look closely at the papers that went with your mortgage, you would see that you would have to pay twice the amount if you are going to stick to the 30 years payment plan. Your amortization schedule would tell you upright that you would have to spend a lot of money to completely own a property. If you are going to pay this amount early on, you would save yourself from paying interest rates and other fees. The faster you own the place, the more peace of mind you will have as well since you know that even if you are going to be underemployed in the future, you don't have to deal with mortgage payments anymore.
The best way to balance the two sound arguments is to plan your mortgage payments carefully. If you don't have a current debt and you are earning well, you can try to increase the rate of your payment and try a biweekly schedule instead of the usual once a month time frame. Consult your lender so that you can be able to work out a deal without causing too much trouble in your financial life.
