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Does it make sense to make additional payments on the principal if I am not looking to remain in the home long term?

by mj504 from Manhasset, New York. Feb 23rd 2016 Reply


SHAHROKH CHARLES BEROKHIM (mortgageusa)
#90 ranked lender in New York - 66 contributions

yes ..because you will finish the loan faster and pay less interest in long run . But check with your accountant if it would be beneficial or not.In most cases don't pay the extra principal but instead invest it in an annuity and make over 8% profit on their investment.

Feb 23rd 2016
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Phil Dumouchel (PhilDu)
#1 ranked lender in South Carolina - 2,228 contributions

Usually only makes sense if you have paid off other revolving and usually higher interest debt and want to lower your mortgage balance. Whatever you pay in additional principal will come back to you when the home is sold, and also lowers the amount of interest paid each month until then.

Feb 23rd 2016
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Jesse Stroup (jessestroup)
#4 ranked lender in Idaho - 591 contributions

That's up to you. If you make additional payments you MAY build more equity in the home, by the time you sell it. If not, you keep the money in your pocket and use it for other things. Maybe something better.

Feb 26th 2016
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Mike Silkworth (msilkw_195_870)
#30 ranked lender in Michigan - 519 contributions

Your question suggests you are thinking of your mortgage as a tool in your overall financial planning toolbox. Congratulations on being so forward thinking. Your next step is to Run to a licenced Financial Planner and ask him/her this question. Best of Luck to you =Mike

Mar 1st 2016
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