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When you pay your monthly mortgage payments, the amount is split between the interest and the loan principal. <\/b><\/p>
At the beginning of the mortgage, the interest accrues on all – or most – of the loan balance and the majority of the amount is going towards interest repayment.<\/b><\/p>\n
As you continue to pay your monthly mortgage payments your principal amount is reduced and so does the accrued interest. Hence, the majority of the amount goes towards principal repayment.<\/b><\/p>\n
Mortgage curtailment accelerates this process. Along with your monthly mortgage payments, you can also make additional payments to lower your principal loan balance. <\/b><\/p>
Once the principal loan balance is reduced the interest rate charged on the principal balance would be less and hence it could benefit you to save both time and money.<\/b><\/p>\n
If you use this process wisely, you can save tens of thousands of dollars over the life of your loan and get your home paid off in less time.<\/b><\/p>\n
Lenders generally make a profit on the interest that they charge the borrowers. By using this process, you are reducing their profit; hence many lenders may not allow the mortgage curtailment beyond a specific amount. <\/b><\/p>
You should check your mortgage documents or speak to your lender to understand if there are any limits set for the additional payments that you can make towards the principal amount.<\/b><\/p>\n
You might need to have a working strategy to execute this type of financial method. <\/b><\/p>
Make sure you have enough money to cover emergencies, unexpected expenses, and all your bills. It would not make any sense if you are opting for this method and are unable to take care of your regular financial obligations.<\/b><\/p>\t\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t