Pay the Mortgage Early or Save?

Normally people wants to get rid of their mortgage installments because it is always a burden and they have to save some money from their monthly income. So it’s on the first priority of many people to pay off their mortgage installments, so that they can enjoy their full monthly income.

Paying extra saved money for mortgage

People having mortgage prefer to pay all saved money to the mortgage lending company, so that they can get rid of their mortgage installments as soon as possible. In this way they also pay less interest and also get some advantages of prepayment.

Paying Mortgage

Normally you have to pay 10 to 15 percent of your gross income as a mortgage installment, every month. This package is designed by the mortgage lending companies to facilitate their costumers. But this package is also a burden for many families and they always want to get rid of these packages by paying more money as a mortgage installment.

Other debts

Do not save money by generating other debts like credit cards, debit cards and store shopping cards, because it is always a great loss to pay extra interest amount on such cards. So try to save more money from your monthly income, if you want to pay off your mortgage sooner.

Normally interest rate that is charged on credit cards and debit cards is 15 to 18 percents and on the other hand mortgage interest ratio is only 5 to 6 percent. So do not generate such debts in which you have to pay more amount of interest.

Emergency fund

Try to maintain an emergency fund. You can develop such fund from your monthly income. Just save a very small amount of money in a separate bank account every month. This will help you in your hard time like if you lose your job, this fund will help you to pay your monthly mortgage installment, until you won’t find a new job.

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