Mortgage payments

[gerryann]

Does anyone know if "Nationwide Bi-weekly Administration" is a legite company? I've received letters from them regarding their bi-weekly program. I know that paying bi-weekly can save a lot of money...just not sure if this particular company is reputable.

[ladydoc]

Does anyone know if "Nationwide Bi-weekly Administration" is a legite company? I've received letters from them regarding their bi-weekly program. I know that paying bi-weekly can save a lot of money...just not sure if this particular company is reputable.

I don't think you need to use a company. Look at your mortage payment slip. There is a line for additional principle payments. Put in there the amount that would equal the biweekly overage amount. Talk to your mortage firm before you pay a company for what you can do free yourself.

[CaptJohn]

I don't think you need to use a company. Look at your mortage payment slip. There is a line for additional principle payments. Put in there the amount that would equal the biweekly overage amount. Talk to your mortage firm before you pay a company for what you can do free yourself.

:agree: Google them if you want to check them out but why bother?.

[perrjojo]

I don't think you need to use a company. Look at your mortage payment slip. There is a line for additional principle payments. Put in there the amount that would equal the biweekly overage amount. Talk to your mortage firm before you pay a company for what you can do free yourself.

I agree..just 100 a month will make a lot of difference. These companies use your money and charge you a fee. Most of the companies are legit but not worth the cost for something you can do yourself.

[Challenger]

Does anyone know if "Nationwide Bi-weekly Administration" is a legite company? I've received letters from them regarding their bi-weekly program. I know that paying bi-weekly can save a lot of money...just not sure if this particular company is reputable.

These companies play on your lack of knowledge in the administration of mortgage finance. By sending them a check every two weeks you in fact make 13 payments in a year. Therefore your debt is paid off sooner with less total interest expenditure. Same thing accomplished by including 1/12th of your regular pymt as a "principal only" payment with each regular remittance. Same final result- no added fees. By using the extra principal option you have better control and can vary the amount of extra principal payment each month. Send more in months when your cash situation is good and less or none if inflow is less or expenses are higher.

[drdodge]

Do business with you bank that hlods the mortgage. why pay someone else that u can do yourself

drd

[rjm1cc]

Does anyone know if "Nationwide Bi-weekly Administration" is a legite company? I've received letters from them regarding their bi-weekly program. I know that paying bi-weekly can save a lot of money...just not sure if this particular company is reputable.
You do not need to use a separate company. Just send the money to your mortgage company. I would enclose a letter and tell them to apply the payment to principal and interest and be sure to check your statement to make sure they correctly apply the payment. You should not have a problem.

[asianthree]

we pay our mortgage on the due date and then sometime in the month i pay a set amount to principal only, have almost paid down by 15 years :wave:

[gerryann]

Thanks for the info. I haden't done my homework, but understand now.

[mac9]

When I had a mortgage, the bank (Wells Fargo) allowed a choice of monthly, bi-weekly, or weekly payments. I chose the weekly with an automatic deduction from checking which knocked off 7.25 years on a 20 year mortgage. Call your lending institution and work it out with them.

[l2ridehd]

There are many different options and ways to effectively pay off your mortgage sooner. Get a mortgage calculator, maybe this one, and you can set it up any way that works best for you. Weekly, bi-weekly, 15 year, etc.

Mortgage Calculator (http://www.mortgagecalculator.org/)

I paid a lump sum on mine, paid the bank the $175 to restructure the payment, not the term, then made the payments as if it was a 15 year loan by adding extra $$$ applied to principle each month. My payment dropped a bit and the loan will be done much sooner. And I have the flexibility to pay the lower amount if I have to for some reason. So just figure out what you want to accomplish, use a good mortgage calculator, tell your bank what your doing, and enjoy the savings. If you need any help setting this up, more information, PM me and I will help you for free. Never pay someone to do something you can easily do yourself.

[aljetmet]

Not sure the point of paying a mortgage off quicker (when you are retired) for a couple of reasons.

1> if you have a mortgage at current rates (if you don't please refinance
) I believe you are paying lower than you should be able to achieve in the market. Instead of paying each month more principal, invest in an ETF or mutual fund. Over the long term you should do better than current mortgage rates of 3.5% - 3.75%

2> We're all (or will be) frogs and will eventually croak. You can't take it with you; spend the extra money now or as per (1) above invest for your later years. Let your heirs worry about selling the house and paying off the mortgage. They should inherit a nice amount say 30 years down the road when Court Yard villas will go for say $750,000

JMHO

[Challenger]

There are many different options and ways to effectively pay off your mortgage sooner. Get a mortgage calculator, maybe this one, and you can set it up any way that works best for you. Weekly, bi-weekly, 15 year, etc.

Mortgage Calculator (http://www.mortgagecalculator.org/)

I paid a lump sum on mine, paid the bank the $175 to restructure the payment, not the term, then made the payments as if it was a 15 year loan by adding extra $$$ applied to principle each month. My payment dropped a bit and the loan will be done much sooner. And I have the flexibility to pay the lower amount if I have to for some reason. So just figure out what you want to accomplish, use a good mortgage calculator, tell your bank what your doing, and enjoy the savings. If you need any help setting this up, more information, PM me and I will help you for free. Never pay someone to do something you can easily do yourself.

why would you pay the bank $175 to "restructure" the mo pmt. when you can add additional principal pmts without charge?

[ncarvalho]

Thanks for the info. I haden't done my homework, but understand now.
Hi,
In essence, if your mortgage is scheduled for fixed monthly payments and they do not charge for prepayment, what happens is that you could send extra payments to apply towards the principal anytime and therefore reducing your balance overtime. So, if you keep on paying more towards the principal and assume you pay the equivalent of a 3 years, then in the end you paid it sooner and your savings is the amount of interest that would have been charged on the last 3 years. For an actual current savings, it will happen only if the bank re-finance the terms of your loan. In my case, I am paying a 15 year mortgage at 2.75%-- it only makes sense for me to pay more towards amortizing my loan incase I cannot get a savings that will give me more than teh 2.75% charged -- because I am saving against my mortgage. Hope this makes sense and good luck.

[l2ridehd]

why would you pay the bank $175 to "restructure" the mo pmt. when you can add additional principal pmts without charge?

Example. You have a 350K mortgage at 4% and you have a PI payment of $1750. You go the bank and pay a lump sum of 150000 on the mortgage leaving you with a 200K balance. You can continue to pay the $1750 or if you give them a $175 fee they will recalc the loan and your new monthly payment is say $950. Now you do the math for a 15 year amortization on the 200K and that is now a payment of $1250. (they wont restructure the term for that fee just the PI payment) So by paying a lump sum, you have dropped your PI by $500 and restructured the loan to a 15 year. If you continued to pay the $1750 it would have brought it down to 12 years, but by doing the restructure you have increased your flexibility tremendously. Cheap cost for major flexibility. I made up all these number so they are probably not right but the process and advantage are close.

Gave me $575 monthly cash flow increase and potential for $900 improved cash flow if needed. Allows me to buy another rental property. I could have just used the cash for the rental, but that would have impacted taxes negatively. This way is a win win strategy.