Making an early mortgage payment might seem like an impossible accomplishment for many, but in reality, it is an attainable feat with a hint of determination. Also, procuring commercial bridge loans to settle mortgage debts is becoming increasingly uncomplicated. In fact, it is the foremost financial objective set by my spouse and me, and we are keen on reducing our mortgage as much as possible.
Previously, we owned a house that was too spacious for our needs and situated in a less desirable neighborhood. We were fortunate to sell it off without a loss. We later found a foreclosure property, that needed repair works, in the countryside. Although it was less expensive than we had intended to spend, we realized a change in our financial habits was necessary, so we opted for downsizing. It was almost an impromptu decision as we had to quickly move out of our old house, but it is a decision we are glad to have made.
By downsizing our house, we were able to reduce our mortgage significantly, which has brought us close to being entirely debt-free today, including our mortgage. I often write about this journey to mortgage freedom on my blog, providing tips and strategies that people find helpful. The topic of mortgage repayment is indeed engaging in the personal finance realm.
Refinancing might often not be the best option for speeding up your mortgage payment, especially if you already have a good rate. Hence, I would suggest certain strategies I’ve personally employed to clear my mortgage more swiftly.
A strategy we’ve adopted for serious savings is Value Based Spending, cutting unnecessary expenses that did not affect our standard of living. Through conscious decision making, we were able to save by reducing our restaurant bills (only eating out on special occasions), groceries, and forgoing shopping and grooming expenses. Instead of giving each other gifts on significant occasions, we decided to spend quality time together, strengthening our bond.
The reduction in expenses has significantly impacted our finances and the falling mortgage balance boosts my drive to spend carefully. It has shown me that small changes can lead to big monetary rewards and frugality isn’t a requirement for reaching significant financial goals.
If you are planning to buy a house or getting a mortgage, it is advisable to go for lesser than you can afford. It seems most people these days prefer small, affordable homes over fancy, expensive houses due to their affordable mortgage and utility bills. It is a trend that I am very fond of and hope continues.
While downsizing might seem daunting, it opens up financial opportunities for other things like travel, settling debts, and investments. A lesser mortgage payment gives a chance to explore more avenues rather than exhausting your budget. In fact, selling your current home and downsizing to a smaller house can be quite rewarding. While it might seem tough to downsize, it is an upgrade to your life. Not only will it benefit you financially, but it also makes your life clutter free, easier to manage and clean your home.
Despite the size of your family, downsizing is a viable option for anyone. You might need to get rid of some stuff, or children might have to share rooms, but all these changes will bring considerable ease to you.
Several strategies can be employed to reduce your mortgage. Some of my personal favorite options are:
1. Use tax refunds, work bonuses, birthday or Christmas money for your mortgage.
2. Start a side job and use the profits for your mortgage.
3. Make biweekly mortgage payments
4. Round up your mortgage payments.
Earnings may seem small at first, especially if your mortgage balance is high, but every penny counts. Use an online mortgage calculator to understand how much you are saving and remember, you can pick more than one strategy for your mortgage.
But above all, ensure you have an emergency fund, providing financial backup in case of unexpected situations. Be cautious about the term of your mortgage as well, aiming for the smallest term you’re comfortable with.
Paying off your debts is a gratifying experience as you see the debt reducing consistently. It is a highly motivating experience. Identify what drives you to save and implement it in your financial planning.
I’m delighted to announce that my husband and I are just a few months away from settling our mortgage, which gives us a tremendous sense of achievement. With dedication, hard work, and a bit of luck, I believe anyone can reach this point.
So, are you prioritizing your mortgage payment? If so, how are you handling the aggressive payments? And if not, why not? Share your experience.
