Advice to help you pay off your mortgage faster

by | May 12, 2024 | Finance and Business

Looking for ways to pay off your mortgage faster? Even small steps over time can make a big difference in how long it takes you to become mortgage-free.

You’ll typically have opportunities to make changes to your mortgage that can help. Some of them you can make at any point during your term, while others you can only make when you renew.

What you can do during your term

Speed up your regular payments:

Depending on the terms of your mortgage, if you’re currently making monthly payments, you might be able to switch to a more accelerated payment schedule. For instance, you could pay semi-monthly, biweekly or weekly instead. Making more frequent payments may help you pay off your principal sooner, which could potentially save you thousands of dollars in interest over the length of your mortgage.

Make a lump sum payment:

Outside of regular payments, a lump sum payment is a one-time payment you make toward your mortgage principal. Depending on the terms of your mortgage, you may be able to take extra cash – such as from a tax refund, a bonus at work or an inheritance – and put that towards your mortgage principal. Speaking to a mortgage advisor can help you make the decision that best suits your needs.

Increase your regular payment amount:

Another option is to increase your mortgage payment amounts, so you’re paying off your principal faster.

What you can do when you renew

Consider your timing:

At some financial institutions, including TD, if you’re close to your mortgage maturity date (the end of your term), you can renew your closed mortgage up to 120 days before your maturity date without prepayment charges, and notably, you cannot renew into an open term mortgage if you currently have a closed mortgage.

It’s important to understand the terms of your mortgage agreement before making any changes to your payments. Connect with a mortgage advisor to walk you through how to take advantage of flexible payment features and help you find ways to achieve your financial goals.

Find more tips on how to pay off your mortgage faster here.

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