This calculator will tell you precisely that. So the mortgage holder is paying more per year (the amount equal to one monthly payment), and the benefit to them for doing so is they'll be debt free sooner and the total interest paid will be lower. To put some numbers on this, if the monthly payment is $2,000, the mortgage holder will pay $24,000 a year when paying monthly. That's the same as making 13 monthly payments. Since there are 52 weeks in a year, you'll make 26 regular payments when paying every other week. The payment amount for a biweekly mortgage is one-half the monthly amount. Let's do the arithmetic! Don't worry it's elementary! Additionally, while you'll naturally make more payments with a biweekly loan, the loan will be paid-in-full sooner than with a monthly payment plan. The reason why you might want to pay a loan every other week is that you'll save on interest charges over its term. However, when your debt is a biweekly loan, you must pay every other week. What is a biweekly mortgage, and why would I want one?īorrowers usually pay mortgages monthly.
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