Several lenders offer loan repayment programs other than the standard monthly payment arrangement. When you set up your mortgage payment repayment plan the most common options are between a standard monthly repayment plans or a biweekly repayment plan. The theory behind choosing a biweekly payment plan is the benefit of an earlier loan payoff. A biweekly mortgage calculator facilitates the calculations on biweekly payment time and interest savings.
With the standard plan on a $200,000.00, 30 year mortgage at a rate of 6%, it takes the 30 years or 360 monthly mortgage payments to fully pay off the loan. With a biweekly mortgage plan it would take approximately 24.6 years to repay the loan. This will save 5 ½ years off the scheduled mortgage repayment time. In addition, the biweekly payment will save over $49,000.00 in interest over the life of the loan.
In a biweekly mortgage the borrower makes a payment every two weeks equal to half the monthly payment on the standard mortgage. Since there are 26 biweekly periods in a year compared to 24 bimonthly periods, the biweekly mortgage payment produces the equivalent of one extra monthly payment every year. The biweekly mortgage calculator allows the user to calculate just how much earlier a loan will be paid off with biweekly payments as opposed to standard monthly mortgage payments. In addition, the biweekly mortgage calculator allows the user to see just how much interest will saved over the life of the loan.
Borrowers who like the idea of paying their loan off early don’t have to refinance into a loan that has a biweekly option or pay for a service that handles the payment. Borrowers can do it themselves by making extra payments monthly or annually on their existing mortgage. By using the biweekly mortgage calculator the borrower can calculate the changes at any time during the loan based on the rate, loan amount and term remaining. It is very important to recognize that the paying off a home mortgage early can be accomplished by different mechanisms. A defined biweekly mortgage payment is one such mechanism. An additional monthly payment during the year is also effective at severely reducing the amount of time it takes to pay off a mortgage loan. The biweekly mortgage calculator and the mortgage payment calculator can help to determine which method may work best and reveal the various options o how to quickly and easily reduce the total costs of a standard home mortgage loan.
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