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Choosing the Right Mortgage Payment Frequency: What's Best for You?

November 25, 2024 | Posted by: Nicholas Pratile

Choosing the Right Mortgage Payment Frequency: What's Best for You?

When paying off a mortgage, the frequency of your payments can significantly impact how quickly you build equity and the interest you save. Here’s a breakdown of common options, using a $20,000 annual mortgage example to illustrate:

Monthly Payments
How it works: One payment per month (e.g., $1,666.67 for $20,000 annually).
    Good for: Simplicity and aligning with monthly budgets.
    Bi-Weekly Payments
      How it works: Payments every two weeks (e.g., $769.23 per payment).
        Good for: Gradually lowering principal with more frequent payments.
        Accelerated Bi-Weekly Payments
          How it works: Slightly higher bi-weekly payments (e.g., $833.33), resulting in 26 annual payments that cover 13 months' worth of payments in a year.
            Good for: Faster mortgage payoff and long-term interest savings.
            Weekly Payments
              How it works: Payments every week (e.g., $384.62 weekly for $20,000 annually).
                Good for: Aligning with weekly income schedules.
                Accelerated Weekly Payments
                  How it works: Slightly higher weekly payments (e.g., $416.67), totaling 13 months' worth annually.
                    Good for: Maximum interest savings and faster principal reduction.

                    What’s the Best Option?


                    Accelerated payment schedules (weekly or bi-weekly) are ideal for saving on interest and paying off your mortgage faster. However, the best choice depends on your cash flow, budget, and financial goals.

                    Need help choosing the right option? Contact Mortgages with Nicholas to explore strategies tailored to your needs.

                    Let’s make your homeownership dreams a reality!

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