Interest rates went up a couple of weeks ago and since I am on a variable rate term, my payment went up slightly. I prefer that over and amortization adjustment. The main reason is that it allows me to keep up with my target goal of paying my mortgage faster. At the time, my amortization was 14 years and 5 months and one of my goals is to be done in 10 years. It’s a challenging goal but achievable.
My mortgage history
- Make bi-weekly payments, or weekly if you can. It saves nearly 4 years up front.
- Manage your interest rates. Always run the numbers. Evaluate the cost of breaking your current term for a lower rate.
What can you do after a prime rate increase?
- I started by rounding up the increase of 16$ and some cents to 25$ and that brought my amortization down to 14 years and 1 month. A saving of 4 months.
- I looked at what an increased of 25$ would do on top of the previous increase and that brought the amortization to 13 years and 8 months. An extra saving of 5 months over the previous.
Have you ever increased your payments?
- Is paying off your mortgage a good investment?
- Fixed or variable rate mortgage?
- Mortgage Term Decision; 1, 3, 5, or 7 years?