Build Home Equity Faster when Buying a Home in MN
Build Home Equity Faster
One way to build home equity faster is to make additional principal payments. You can sign up for a bi-weekly mortgage, in which you make two payments per month (which added together equal one monthly payment). You will make the equivalent of 13 monthly payments per year instead of 12. A 30-year loan with a bi-weekly payment plan is usually paid off in about 20 years.
The other way to build home equity faster is to refinance. If you had a $200,000 30-year ARM at 8.13 percent and replaced it with a 15-year fixed rate loan at 6.75 percent, your monthly payment would go from $1485.69 to $1769.82. You would save $200,000 in interest and build the same amount of equity in half the time.