Refinance to Pay Off Your Loan Sooner
Refinance to a shorter-term mortgage
You can take advantage of lower rates and switch to a shorter-term loan, allowing you to pay off your loan sooner.
You may have a higher monthly payment, but your total interest payment will be reduced significantly by switching to a shorter-term mortgage.
Example: If you have 25 years and $150,000 remaining on a 30-year mortgage at 5.25% and refinance the $150,000 with a 15-year mortgage at 3.5%, you could save $66,645 in interest payments over the life of your loan.
|Term||Loan Amount||Interest Rate||Interest Paid||Savings|
|25 years remaining on a 30-year||$150,000||5.25%||$109,663|
Make additional payments on your current mortgage
You can pay off your loan sooner without refinancing by simply making additional payments on top of your regular, monthly mortgage payment. Additional payments can add up quickly, take years off your mortgage and reduce your overall interest payments.
Example: If you have 25 years remaining on a $100,000 30-year mortgage at 5% and pay an extra $100/month for the remaining term of the mortgage:
- Your mortgage will be paid approximately 6 years and 7 months earlier
- You will save $22,046 in total interest by paying sooner
Have questions? Ready to apply? We're here.
Talk to a mortgage advisor at 1-800-822-6761