Pay less interest
“Make biweekly payments on your mortgage and pay off your 30-year in 24 years, save thousands of dollars in interest. “
Sounds good? Wait, there’s more…
“There is a set-up fee of $300, plus a $5 service fee with every payment.”
That’s a small price to pay for saving thousands, right? WRONG!
How would you like to save the same amount of interest with absolutely no fee?
All you are doing when you make a biweekly payment is making an extra payment each year. You can do that easily yourself. There are 2 ways to handle it:
1. Take your monthly payment and divide by 12. Add that amount to each month’s payment. It is vital you include a note with your payment to explain the extra amount goes towards principle. Otherwise the loan servicing department may not credit it correctly. You may even have to write a separate check for the extra amount.
2. You can make an extra payment at the end of the year. Again, include a note with your payment to tell the servicing department to credit it towards your principle. Otherwise, they will assume you are making a regular mortgage payment.
See, I charged nothing for saving you thousands of dollars in interest.