7 Strategies to Help You Pay Off Your Mortgage Faster

By Sara


Last Updated: October 27, 2022



One of the largest and most common debts people have is their home’s mortgage. Most people need a mortgage to be able to afford a home. Unfortunately, it can take many years to save the full amount of a home, and most people need a home now.

While you can follow the traditional 30-year mortgage payment, there are ways that you can pay off your mortgage faster with these seven strategies.



7 Ways to Pay Off Your Mortgage Faster

Make bi-weekly payments. 

Most mortgage payments are monthly, so you will make 12 monthly payments towards your mortgage in a year.

If you switch to bi-weekly payments, you will end up paying 13 monthly payments (one extra payment a year). While this might not seem like a lot, it really can save on the interest you pay and help you pay off your mortgage faster. 

For example, your monthly mortgage payments are $1,000.

  • On a typical mortgage payment plan, you will pay $12,000 toward your mortgage.
  • If you switch to a bi-weekly payment plan, then you will pay $500/bi-weekly for 26 payments.
  • This total is $13,000, which is like an extra month compared to the monthly mortgage payment plan.

This $1,000 extra towards your mortgage can save you over $25,000 on interest and shave 4.5 years off your mortgage. 


Budget for extra payments.

If your financial goal is to pay off your mortgage faster than your payment plan, one of the best ways to do this is through budgeting for extra payments. The next tip will explain where you put those payments, but this tip is to explain how you can budget for this extra payment. 

As you track your spending and create a budget, make a line in your budget for extra payments towards your budget. Then, see where you can cut back your spending. You can make a plan to pay extra every month or make a lump sum after a year of saving.

This is up to you and how you want to put those extra payments toward your mortgage. 


Put extra payments towards principal.

When you want to make extra payments on your mortgage, make sure they are going to the principal amount that you borrowed.

Putting your extra payments towards the principal will help reduce your mortgage term and total interest paid. As a result, you could shave off years on your mortgage and save a huge amount in interest. Make sure to call your mortgage provider to discuss how to make additional payments on your mortgage. 


Refinance your mortgage.

Another way to pay off your mortgage is to refinance your mortgage to a lower interest rate.

You may have had a higher interest rate for your mortgage depending on when you bought your home or your credit score. If the rates are lower now than when you bought your house, you can refinance to a lower rate, reducing your monthly payments.

The money you will save with lower monthly payments can be put toward your loans as extra principal payments. 


Refinance your term.

A typical mortgage is a 30-year mortgage.

This will give you the lowest monthly payments, but you’ll pay the most interest. You can refinance to a 20 or 15-year mortgage. You’ll pay more monthly payments but significantly less on interest and have a mortgage for less time.

Depending on your rate, you could be saving $50,000 or more if you have a loan for a $250,000 mortgage. 

If you currently have a 30-year mortgage, you can switch to a 15-year mortgage, and you could get a lower interest rate as well.

However, keep in mind that when you refinance your mortgage, there will be closing costs which could be a few thousand dollars to pay. 


Recast your mortgage.

Recasting may be a good option if you have a lump sum payment and want to reduce your loan term, but keep your current rate.

When you recast your mortgage, you are putting a large sum towards the mortgage, and your bank will re-adjust your payoff schedule with that new balance. This can help make your term shorter. 

The cost of recasting your mortgage is only a few hundred dollars, and you get to keep your current interest rate. This is beneficial if you have a lower rate. If you have a higher rate, it may be better to refinance, but look into the cost of doing this and what will be the best for you. 


Make a lump sum payment.

If you recently inherited a large sum of money or saved up for a year to put that money into your mortgage, consider making a lump sum payment towards your loan.

You may be able to put this amount into the principal payment. If you can’t, the money will be evenly split between the interest and principal. This can help you save years off your mortgage and save on the interest you’d have to pay (especially if it can all go towards the principal balance). 



Final Thoughts to Help You Pay Off Your Mortgage Faster

A mortgage doesn’t have to be a debt that you have had for 30 years.

While this is normal, there are easy ways to help you reduce the length of time that you will have to pay off your mortgage faster with extra payments or refinancing. Any extra money that you can put towards your mortgage will reduce the time you have your mortgage and save you money over time.

Photo by Ketut Subiyanto


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