probably not. Check the terms of your note; they usually call for x payments of y amount
Just accelerate the payout dateIf I have a mortgage and make a LARGE lumpsum payment to it will my monthly payments go down?
You are reducing the interest so the payments remain the same. You still have to make your monthly payment. If you can still afford to make the payments, it would foolish to refinance since you paid about 70% of the interest.
If you have a fixed intersest rate your payment will not change, but if you have a variable rate which means the rates are recalculated every year or so at the time of the recalculation your payments will change due to the fact you will then be paying interest on a smaller amount of money. If you have a fixed rate and you would like to lower your payments one option is to refinance using your principal payment instead as a down payment on the new mortgage.
NO THE PAYMENTS WOULDN'T GO DOWN. IT WOULD JUST DECREASE THE LOAN BY A LONG SHOT AND GET RID OF TONS OF INTEREST. IF YOU HAVE A 30 YEAR NOTE ON A $60,000 LOAN AND MAKE 1 EXTRA PAYMENT A YEAR YOU KNOCK YOUR LOAN AMOUNT DOWN TO A 23 YEAR NOTE. IF YOU WOULD ADD AN ADDITIONAL $50 EACH MONTH TO THE PRINCIPAL YOU WOULD DECREASE YOUR LOAN TO AN 18 YEAR NOTE. BUT MAKE SURE IF YOU WERE TO DO IT TO WRITE AND MAKE SURE THEY PUT THE MONEY TOWARD THE PRINCIPAL. IF YOU DON'T SPECIFY IT THEY WILL TAKE IT AS A REGULAR PAYMENT AND YOU WON'T GET RID OF NEAR AS MUCH INTEREST.
It should do. Have done something similar in the UK and my monthly payments went down from three figures to two figures a month. Ask your mortgage company to estimate your new monthly payments if you do pay a large lump sum. I am self-employed and it means that when I am not working (like now!), I don't have to worry too much about the bills.
The best person to ask: somebody at the company that holds the note on your property. Sometimes, there can actually be penalties for paying ';too much'; in a single payment. You should make sure the funds will be properly allocated to your account.
Most likely not. It would be applied to the principal amount that you still owe, so your total time for the mortgage would be shortened, but monthly payment would normally stay the same.
it sgould 100000 is a lot more than 5000000
Another thing to consider is not making a lump sum payment. If the interest rate on your mortgage (assuming it is fixed) is lower than what you could make investing in a mutual fund (8% return on average) then it may be a good idea to invest that lump sum amount into a mutual fund so you can earn money and then have the option to pay a lump sum amount down the road if it makes sense to do so.
No it wont. You can usually prepay without penalty. It will dramatically shorten the loan. For example it may take a 30 year mortgage and pay it off in 10 years(ish), but it wont lower the monthly payments unless you refinance.
no, you have to refinance it in order to get smaller payments
There are two answers to this...Yes, if you refinance..... No, if you just make the payment it will shorten the length of payments you have left but not make them any lower....also if it shortens the length of your payments make sure you do not have an early payoff penalty in your mortgage contract before you do it.
Not usually ,
Normally your payoff date would be a lot sooner ,
Unless your loan contract says otherwise .
What does your loan contract say ?
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Perhaps not....but you won't be paying for as long a time.....and a lot less interest.
Go For It.
To get lower payments you'd need to renegotiate your loan. Watch out for fees and the interest rate.
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