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Mortgage Tricks to save thousands of dollars

sweet home 'mortgage saving'  heloc

To own a home is an American dream. Besides making an individual's life more fulfilling, a home (and a mortgage) also keeps the US economy rolling.

Once your American dream is fulfilled, it creates a sort of drain on your finances. Majority of Americans borrow significant amount to finance the purchase of their home. This results in monthly mortgage payment, annual property taxes, possible HOA dues etc. Most of us are not aware but we end up paying several hundred thousand dollars as interest payment on the money we have borrowed (mortgage)

On next few pages, we attempt to help you save with your mortgage payments.


The purpose of this page is to play around with some numbers and to do some financial math that can help you save some money.


Mortgage payment voucher comes in the mail every month with a due date of 1st of the month but did you know that you usually get 15 days of grace period to make your payment? I believe most of us pay on the 1st itself. We don't care of 15 days worth of holding onto our monthly mortgage payment. Now if you decide to delay your payment by 15 days each month, what kind of benefits do you have? Most of you would immediately tell me that it is not worth the trouble. But if you try to put some financial sense into this, I am sure you will get surprised by the magic of compounding.

If you don't care about paying 15 days late, I am sure you can stretch yourself and pay 15 days earlier too. I mean to say that if you are planning to pay your next mortgage payment on say 1st of May, please pay it on 15th of April instead and then on every 15th of the month. Now the payment you make on 15th of April, mark it as payment towards your principal. Do you know how much wonders this will do overall?

Let us run some numbers on the following scenario:

Assume this is your mortgage:

You are supposed to pay 2398 every month till January 2038:


Now instead of paying on the 1st, you change to pay it on 14th of the month and somehow squeeze in one payment by paying it early towards your principal.

Mortage Tip

Do you know that this "15 days doesn't matter" would save you full 5 monthly payments at the end? Plus, $2000 on the last payment you make?

Sounds confusing?

Here is an example of one schedule:

  1. A payment one normally makes at the end of the month of $2398.20. Assume this payment made around Nov 30: Mark it as Regular payment (Interest + Principal)
    ---- The above payment has due date of Nov 30 but most lenders give you additional 15 days (please look at the back of your mortgage payment invoice/form) so actually most of us are not taking advantage of these 15 days of grace.
  2. $2398.20 to be paid around December 15th: Mark this a special/extra payment towards principal
  3. $2398.20 will be paid around January 15th : This is a Regular payment (Interest + Principal)
    ----- This payment notice has a due date printed as Dec 31,xxxx but we are paying it on Jan 15 by using 15 days of grace period.
  4. $2398.20 to be paid around February 15th : Regular payment (Interest + Principal)
    ----- This one has due date of Jan 31st and we are paying it on Feb 15 using 15 days of grace
  5. and this way we will keep making payments on 15th of the next month instead of on 30th of the prior month

Still confused? Please click here to contact us:

* Assumptions:
---> You will be punctual in paying by 15th. If you fail, there is some penalty. However with Automatic setup online, this is no longer that difficult as such. I would advise to try to pay by 14th of the month.
---> It is assumed that you are currently paying by 1st of the month and you have no financial difficulties in paying that monthly bill 15 days earlier each month. As said, no pains no gains, and there is never a free lunch in financial markets.
---> It is important that the first time you pay on 15th, you mark it as a payment towards Principal amount else all these benefits will accrue to your lender instead of you.

If you like this tip, please forward this page to your friends and click here for another excellent mortgage payment tip.