The hardest part in investing is paying the mortgage. Amidst this pandemic, paying it on time is even harder. In this time of an outbreak and economic instability, the possibility of losing your home because you can’t pay your mortgages on time can be terrifying.
Due to rolling lockdowns, job loss and other problems related to the pandemic, you’re probably having trouble making ends meet. Your financial problems greatly affect how you pay for your mortgage.
If you are one of those people might be experiencing financial stress and mortgage anxiety nowadays, paying the mortgage biweekly might help save your home and avoid foreclosure of your property.
In a biweekly mortgage payment, the borrower make payments every two weeks instead of once a month. It means that the borrower is paying a total of 26 half payments or 13 full or monthly payments over a year. Because you have an extra payment every year, you are accelerating payoff of the loan and the extra payment per year can provide significant savings in total interest over the life of the loan.
To understand better how biweekly payment can help you, check out this online free Biweekly Mortgage Calculator. With the help of this calculator, you will discover how much time and money can be saved by making regular biweekly payments rather than monthly payments on your mortgage.
Using the calculator is so easy. Under Loan Information, you have
to provide the amount for the home price and the down payment which should be at least 25% of the home price. From those two values, home loan amount will automatically be calculated. Their difference is the home loan amount or the mortgage.
Annual Interest Rate differs from city to city and is dictated by the current economic conditions in the area. It is the rate given by a lender for a specific amount of loan. Click the Rates tab if you want to find the best lender in the city you are planning to buy the property.
The Term of the Loan is the length of your loan contract in years which could be as long as 30 years. Remember that the longer you pay off for your mortgage, the higher the interest it accumulates over time.
Private mortgage insurance or PMI is no longer needed if you paid at least 25% down payment. Start Date of Mortgage, the month and year you started paying biweekly mortgage; presumes you start making biweekly payments at the onset of the mortgage. The amount of Other Ownership Expenses such as the following, must also be provided :
Annual Real Estate Taxes
Annual Homeowners Insurance
Monthly HOA Fees
The pay-off date comparison is the most helpful information that you will obtain from this calculator. The calculator clearly shows how many months or years you will save from paying bi-weekly mortgage instead of the regular monthly payments. You can save almost 4 years, for a 30-year fixed contract. If you started paying bi-weekly on the onset of the mortgage, for example February 2021, you will finish paying off your mortgage by 2047 instead of 2051 and you can save as much as 15% of interest.
Remember that a biweekly mortgage is a firm commitment to make a payment every two weeks and it cannot be changed from month-to-month. Make sure to have enough monthly budget to cover the mortgage payments and other expenses as stated in the biweekly mortgage calculator.