Biweekly Mortgage Payment Advantages

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Biweekly Mortgage Payment Advantages

January 21, 2015 - 08:38
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Ever since the subprime crash and financial crisis of 2007 to 2009 there has been a lot of ink devoted to ways to manage your risk and pay down debts like a mortgage quickly and effectively. One particularly popular option (at least if you believe the number of blogs about it) is the Bi-weekly or every other week payment plan. The main biweekly mortgage payment advantages and chief driver of your savings is that you make 13 payments a year on your mortgage vs the normal 12 with that final payment going fully to principal. This is especially effective and important in the first 5 years of your load when nearly all of your payment is going to interest. During this nasty portion of the amortization schedule paying the 13th all principle payment drastically increases the reduction rate of the balance and gets you to the steeper more effective portion of the pay-back schedule far, far sooner.

If you would like to run the numbers on your own loan here is about the best mortgage calculator I have found from Bankrate.com:

Biweekly mortgage payment calculator