Many homeowners have been using various means to erase their mortgage debt quickly so that they can own their home outright. Financial difficulties, the job market, and trouble with mortgages have spooked many homeowners and, as a result, there are more homeowners looking for ways to get out of mortgage debt as fast as they can.
One way that homeowners have been erasing their mortgage debt quickly is by refinancing to shorter-term mortgages, like a 15-year fixed rate mortgage. A 15-year mortgage can come with a much lower interest rate than a typical 30-year fixed mortgage and, obviously, can be more affordable overall when total costs are factored in. A shorter repayment time frame on a mortgage will give interest less time to build up and will cost less to a homeowner when all is said and done.
However, some homeowners may be unable to take this route as a 15-year fixed rate mortgage often comes with a higher monthly mortgage payment then other common mortgages like, again, the 30-year fixed mortgage. Yet, homeowners who can afford a higher monthly mortgage payment have been budgeting and using this type of mortgage in order to get out of debt in half the time it takes those in a 30-year home loan situation.
While mortgage payments are heavily considered into a homeowner’s decision when it concerns the type of home loan they acquire, there are homeowners with a 30-year fixed mortgage who have simply been paying more on their home loan each month so as to erase their mortgage debt faster. Typically, a mortgage lender will apply any amount paid over the minimum requirement to a homeowner’s principle, which can help pay off mortgage debt years ahead of schedule if a homeowner simply makes a higher payment each month. Homeowners may use this method since, if they have unforeseen expenses arise during the month, they can revert to their low monthly mortgage payment and are not required to make a higher home loan payment.
Homeowners who are seeking ways to erase their mortgage debt quickly are often advised to talk with their home loan provider or a financial advisor before proceeding. While refinancing can be quite costly and, again, a higher monthly mortgage payment on certain types of mortgages may be difficult for homeowners to meet, consideration should be made before deciding on a plan of action to erase mortgage debt. Also, there are lenders who may charge a penalty if a homeowner pays their home loan early, so this is another factor that needs to be researched by an individual homeowner.
Yet, homeowners have been able to afford the costs of refinancing to a 15-year fixed rate mortgage or pay more on their home loan payment each month and benefited by not only erasing their mortgage debt faster but by spending less overall on their home loan. Homeowners who may be on a stable financial ground are often advised research their options, look at their financial situation, and then proceed with the plan that will be in their best financial interest for erasing their mortgage debt in a timely manner.