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Tips for Paying Down Mortgage Debt

housedrawingIf you’ve determined that for you the path to financial security includes paying off your mortgage sooner rather than later, Yahoo! offers some tips in “Five ways to pay off your mortgage fast.”

Be advised that these tips may not be for everyone and you should seek the advice of a Fee-Only Financial Planner about your individual situation. Overall the suggestions offer insight on how to pay down debt in general—it starts with the decision to decrease the debt followed by finding a viable way to pay it down without jeopardizing your necessary expenses.

Put one salary towards the mortgage. This option works if you are in a marriage or partnership where both partners earn enough to both pay down the mortgage debt and keep up with regular expenses.

Pay your mortgage on a bi-weekly schedule. This will mean making 26 payments a year but depending on your income, you pay not feel a huge pinch in your budget. In some cases, it can add up to an extra payment a year. And that means that you will save a lot on interest over time.

Put extra resources towards the mortgage. Rather than simply paying the set amount each month, pay more whenever you can and use any extra windfall you get (tax refund, work bonus, etc.) towards your mortgage. This will help whittle it down faster than if you just stick to the standard monthly payment plan but you are not committing a regular amount to paying down mortgage debt.

According to Kiplinger, it may be better to pay down high-interest debt such as credit cards or contribute to retirement savings than to use extra funds to pay down a mortgage. And if you do choose to pay down your mortgage, you need to request that the extra funds be applied to the principal, verify that you don’t have any pre-payment penalties, and check statement to ensure that the extra really did go towards your principal.