Beating High Mortgage Rates: The Power of Making Biweekly Payments

Mortgage 101
Making biweekly payments on your mortgage can help you save money and pay down your loan faster than making monthly payments. Benefits include fewer interest payments, less stress on your budget, and the potential to shave years off your loan's term.
Published on
July 16, 2024
Copy link

With mortgage rates on the rise, many homeowners are feeling the pinch of higher monthly payments. While there's not much you can do about the interest rate on your mortgage, there is a simple and effective way to pay it down faster - making biweekly payments instead of monthly payments.

 
What does this mean?
 

Instead of making one mortgage payment per month, you split your monthly payment in half and pay it every two weeks. So instead of 12 payments per year, you end up making 26 half-payments. This has the effect of making one extra monthly payment per year, which goes entirely towards your principal.

 
The benefits of biweekly payments:
 

- Pay off your mortgage faster: By making 26 biweekly payments, you fit in an extra 1-2 monthly payments per year. This can shave years off your mortgage term.

 

- Pay less interest: Since more money goes towards reducing your principal, less of your payment goes towards interest. Over the life of your loan, you can save thousands in interest costs.

 

- Forced savings plan: Splitting your mortgage payment into smaller chunks makes it easier to budget and saves you from having to come up with a large lump sum each month.

 

- Time is on your side: The longer you have left on your mortgage, the greater the benefits of biweekly payments. Starting early maximizes interest savings.

 
Getting started with biweekly payments:
 

- Talk to your lender - Make sure there are no restrictions or fees to enroll. Many lenders offer biweekly payment options.

 

- Use auto-debit - Set up automatic transfers from your checking account every other week to make it effortless.

 

- Make an extra payment directly - If your lender doesn't offer biweekly payments, make one extra principal payment annually.

 

The bottom line is that biweekly mortgage payments can be an effective strategy to pay off your home faster and for less. By making your money work harder, you can beat those high mortgage rates and become mortgage-free sooner. Give biweekly payments a try and see the impact yourself.

Get started today
Whether you're actively looking, or just researching, you can find out what you qualify for and get connected with a pro.
Apply Now
The Secret to Mortgages: Your Key to Homeownership!
Our team of experienced mortgage professionals is ready to guide you through the process and find the perfect mortgage solution for you.
Get Started!
Latest posts

Don't Stop Here

Check out some of these related articles.

Maximizing Your Hard Money Loan: The Importance of Loan-to-Value Ratio

This blog explores one important aspect of hard money financing - loan-to-value (LTV) ratio. It covers the definition and calculation of LTV ratio, the benefits and challenges of using it for hard money financing, and how it works in practice.
Read post

What are the Pros and Cons of Hard Money Lending?

Keeping all your options open when it comes to financing is crucial to every business. Understanding everything about hard money lending, including both the pros and cons, will allow you to make an informed decision about what choice is best for you.
Read post

Making Sense of Mortgage Documents: Your Comprehensive Guide

A comprehensive guide to understanding mortgage documents. Learn about the different types of mortgage documents such as loan estimates, closing disclosures, promissory notes, and more. Gain insight into the importance of each document in the mortgage process. Don't miss out on this essential knowledge for homebuyers.
Read post