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Paying Off Your Mortgage Faster

Put extra money toward your mortgage

To pay off your mortgage faster, consider putting extra money toward your mortgage.

Your mortgage contract may allow you to:

  • increase the amount of your regular payments
  • make a lump-sum payment
  • Your lender calls this a prepayment or prepayment privilege.

 

Increase your payments

Increasing the amount of your regular payments, even by a small amount, may help you pay off your mortgage faster

You may only be able to increase your payments by a certain amount each year. The amount will be written in your mortgage contract. If you increase your payments by more than your prepayment privileges allow, you may have to pay a prepayment penalty.

Normally, once you decide to increase your payments, you won’t be allowed to lower them until the end of the term. The term is the period of time that your mortgage agreement is in effect, including your interest rate and terms and conditions.

Check your mortgage contract or contact your mortgage lender to find out about your prepayment options.

 

Make a lump-sum payment

You can make a lump-sum payment on top of your regular mortgage payments to reduce the outstanding balance of your mortgage.

You may only be able to put a limited amount of money toward your mortgage. The amount will be written in your mortgage contract. If you put more money toward your mortgage that your prepayment privileges allow, you may have to pay a prepayment penalty.

Lump-sum payments can be made:

  • before the end of your mortgage term
  • at the end of your term
  • at certain times during your mortgage contract
  • on certain dates set out in your mortgage contract

Check your mortgage contract or ask your mortgage lender to find out about your prepayment options.



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