# How Much Do Biweekly Payments Shorten a 30-Year Mortgage?

Making biweekly payments to your mortgage can save you thousands of dollars in mortgage interest. Instead of making monthly mortgage payments, you pay every two weeks to coincide with your regular biweekly paycheck. Your payments are more frequent and therefore lower, and paying your mortgage on the same day as you receive your paycheck means you might not miss the funds as much as when you make a larger mortgage payment on the same day once a month.

## How it Works

The mortgage lender calculates your monthly payment based on your interest rate. You pay that monthly amount divided by two every two weeks. It might feel as though you are paying the same amount every month, but in fact you will be making the equivalent of one extra mortgage payment every year. On a monthly basis you would make 12 payments per year. But since there are 52 weeks in the year, paying every two weeks means you will make 26 payments equal to one half of your monthly mortgage payment, or 13 monthly mortgage payments.

## Reduced Interest

In a single year you will make one extra mortgage payment by making three biweekly payments in two months of the year. By the end of each year your additional payments will reduce your interest charges and therefore reduce your payment period. The \$300,000 mortgage at 4 percent for 30 years with monthly payments will have a principal balance of \$294,716.89 at the end of the first year. With the extra biweekly payments, that balance would be \$293,210.51, or more than \$1,500 lower that it would be without the extra payments.

## Shortened Payment Period

Paying half the monthly mortgage amount every two weeks will reduce your balance and interest charges faster and result in your mortgage being paid off in 25 years and 42 weeks. Your mortgage payment duration would therefore be reduced by more than four years