You may have heard that lenders sometimes charge prepayment fees for paying off a conventional loan early. But what about VA loans? VA loan requirements are different than those for conventional mortgages. So, are the prepayment fees the same? Below, we’ve discussed the matter in detail.
What Are the Benefits of Prepaying Your Mortgage?
Most mortgages, including VA loans, allow people to pay over on their monthly payments. But why would people want to do that?
Well, if you overpay each month, you may be able to pay off your mortgage sooner. This usually means that you end up paying less interest over the lifetime of your loan. Prepaying can allow borrowers to save a lot of money.
However, it’s important to know that if you have a conventional loan, your lender may charge a prepayment fee.
Can I Pay Over on My VA Loan?
As far as VA loan requirements go, paying over on your mortgage is completely allowed. And unlike conventional mortgages, there are no prepayment fees.
Strategies for Paying Off Your VA Loan Early
Here are a couple strategies that you can use to make additional payments and pay off your VA loan ahead of schedule.
Pay a Little Extra Each Month
The first strategy is to pay a little extra each month. You can pay $100 extra or any other convenient amount along with your regular payment. If at any point of your payment duration you feel that you can comfortably afford to pay extra, do it. The reason for doing that is simple – you shorten your loan’s life. Paying less interest can help you save money.
Make 13 Payments
If the first strategy doesn’t sound convenient, try this one. You simply pay 13 payments instead of 12 annual ones. You can choose the time of payment at your convenience. Making one extra payment yearly can pay off your mortgage loan early.
Prepaying Can Help You Save Money
VA loan requirements do not prohibit paying off your mortgage early. There are also no extra fees for prepayment when it comes to VA loans. If it’s financially feasible, it may be a good idea to overpay on your mortgage. You could save a lot of money. And there are strategies you can use to accomplish this goal. If you ever have questions about your VA loan, do not hesitate to reach out!
Have Questions About VA Loan Requirements?
When it comes to VA loans, we’re experts! Call Mortgage Solutions Financial today to get the additional insight and information you need!