Financial Tips

Tips for Paying Off Your Mortgage Early

We all love a beautiful home and all the gorgeous furnishings, but the part that isn’t so glamorous is the monthly payment that comes along with it. The truth is, having a mortgage is simply a part of life for most homeowners.

Thankfully, there are a few different ways to pay off a mortgage much sooner, but it takes discipline. Henry and I are proof that it can be done with some hard work and a budget-oriented mindset. It took us around thirteen or fourteen years to become debt-free, but we did it. We would love to share with you all a few tips that you could implement and be on your way to a home that is paid for!

Purchase a Home that is Less than You Can Afford

The very first suggestion I have is for those who have not yet bought a home. Before you purchase a home, make sure you buy under what you can afford. This is a great tip all around because it can be helpful in so many ways. Keep in mind, you will have plenty of time later for bigger and better. You need to work your way up. You don’t want to be house poor.

I remember the first home Henry and I bought. It was very small and needed a ton of work. This was great because it allowed us to afford the payment while having a little each month to make home improvements. All of the improvements we made tuned into equity and we gained a better profit when we sold. We then in return, put this money back into another house.

Maximize Your Down Payment

This again is for someone who hasn’t yet purchased a home. Maximizing your down payment will make your monthly payments less and will also free some up to make extra payments towards the principal. So, if you have the cash, put it somewhere that will be useful.

If you don’t have much to put down, it could even be wise to hold out until you can save more. Bigger down payments will often times reduce interest rates allowing more to go to the principal.

Make Extra House Payments

Making extra house payments beyond your monthly payment can reduce your mortgage a great deal. Any amount you pay other than the monthly payment goes all to the principal.

You can do this in a variety of ways. If you have extra each month, try making a payment every two weeks instead of just once a month. If this is too much, try making an extra payment quarterly. Another idea: If you get a yearly bonus, use it to make a lump sum payment on your mortgage. You can also do the same with your income tax return.

Go Lower Than a 30 Year Loan

Any loan less than 30 years will result in a higher monthly payment. However, a 15 or 20-year loan is so much better if you can afford it. Not only will you get a lower interest rate, but this will also allow you to get your home paid for much sooner!

Chances are, you will probably not miss the extra each month after getting used to it. This is where it will be important to have discipline and put yourself on a monthly budget.

Buy and Sell Homes You Have Equity In

Out of all the tips I have pointed out, Henry and I have lived by this one. Good thing we love remodeling and building homes, right? With a combination of budgeting, a couple of builds and remodels we were able to achieve our goal of having a home paid for along with all of our other debt. But keep in mind, this only works if you are willing to move a few times and put some hard work into each build and remodel.

This is basically how it worked for us: buy or build a home under budget, live there for at least two years (or sometimes 4), sell, then repeat. It’s actually a pretty simple process that works if done properly.

Every home we purchased or built automatically had instant equity due to purchasing under appraisal with remodels and doing lots of hands-on work ourselves when building. Our fourth home was a remodel and it was paid for. We are now in the process of building our fourth new home.

It’s been a long journey with plenty of bumps along the way, but it’s been so worth it!

So, those are our tips. If you have some of your own, feel free to share them in the comments.

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  • Reply Tatiane

    Great post. We worked very hard to put 20% down payment towards our new home. It definitely made the difference on our mortgage. Hope in a year or so we can start to make a bigger monthly payment as well.

    October 30, 2019 at 1:05 am
    • Reply Brooke

      Thanks. A 20% down payment is great!! I’m sure that did help a ton with your monthly payment.

      October 30, 2019 at 1:21 am
  • Reply Leeanne Holgan

    Hi Brook, These are great tips! We paid off our mortgage early. We had a 30 yr loan but doubled up and sometimes tripled our payment each month. All extra money went to paying off the mortgage.

    October 30, 2019 at 1:23 am
    • Reply Brooke

      Thanks. That is so awesome. Congratulations!

      October 30, 2019 at 1:27 am
      • Reply Christina

        We like to put enough money down to avoid MI (mortgage insurance) that you get nothing for it. Our house we are currently in we paid cash for. Always make extra payments…

        January 5, 2020 at 11:15 pm
        • Reply Brooke

          Yes, that is a great idea Chistina!

          January 6, 2020 at 1:38 am
  • Reply Mary Glenn Lively

    This is such a great topic, thank you for sharing!

    October 30, 2019 at 2:26 am
    • Reply Brooke

      Glad you enjoyed it!

      January 6, 2020 at 1:36 am
  • Reply Christina

    Great article! This information is helpful for my future home buying!

    January 6, 2020 at 2:49 am
    • Reply Brooke

      So glad you enjoyed it Christina!

      January 6, 2020 at 6:09 pm
    • Reply Tawni Burns

      Great post! It is also important to remind people to NOT use your home as an ATM machine. I am a Realtor and live in Southern California and see it to often.

      April 2, 2020 at 3:38 pm
  • Reply Deborah

    Great article! This is a roundabout way to get to the “paying off your mortgage” topic, but with each house we’ve bought, we started working on the yard first. Not only did it help us get to know our neighbors, but seeing our yard fill up with trees and shrubs and flower pots seemed to spur the neighbors on to beautify their yards too, which meant that a few years later when we were ready to sell, our neighborhood looked much prettier than it had when we bought it. We’ve made nice profits on each house we’ve owned…the best investments we could have made with the income we had to work with.

    January 28, 2020 at 1:13 am
    • Reply Brooke

      Hello Deborah!

      That is such a great tip! I totally agree, sprucing up the outside is so beneficial in many ways. First impressions are the most important. Thank you so much for following along with us!

      January 29, 2020 at 6:11 pm
  • Reply Amanda

    I love this idea. Just a question if either you or your husband have a realtor’s license? Otherwise, don’t the commission fees eat into your profit? Thanks!

    August 30, 2020 at 4:08 am
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