How do I Pay Off a 30 Year Mortgage Early?

Even though the terms on your mortgage say 30 years, that doesn't always mean you have to make payments for 360 straight months. You can take steps to pay off your 30-year mortgage earlier than normal. Taking this route saves you interest costs, and in the future you can put the money you would spend on your mortgage toward other investments. You'll also have peace of mind knowing that you own the home you're living in free and clear.

Pay your mortgage biweekly to pay if off early. Instead of paying your mortgage once per month, you pay half your mortgage every two weeks. When you do this for a full year you end up paying an additional monthly payment, which reduces your principal --13 payments instead of 12. In some cases you have to sign up for a biweekly payment plan with your mortgage company to use this method of paying your 30-year mortgage off early. With a hypothetical loan of $100,000 for 30 years at a 6 percent interest rate, you will pay off the loan within 24 years instead of 30 using this method.

Send your mortgage company any additional money you have available with each payment as another option to pay off your mortgage early. Make sure you include a note with your payment stating that the additional money must go toward principal. Say you have just $50 to put with your standard mortgage payment each month on this hypothetical loan. This allows you to pay off the loan within 25 years instead of 30.

Submit at least one extra payment per year to pay off your mortgage early. Again, make sure you clarify to your mortgage company that you want this additional payment to go toward reducing your mortgage principal. If you paid $1,000 extra toward your principal every year in the hypothetical $100,000 loan, the obligation is paid off in about 22 years instead of 30.


  • Keep one key disadvantage of paying off your mortgage early in mind before you embark on this plan. Once the mortgage is paid off, you can no longer deduct mortgage interest on your taxes. In addition, there is no guarantee that paying off the account will increase your credit score -- in fact, in some cases it could cause the score to decrease slightly.
  • Verify that you don't have to pay a mortgage prepayment penalty if you pay off your 30-year loan early. The prepayment penalty is commonly six months of interest, but varies by lender.

About the Author

Louise Balle has been writing Web articles since 2004, covering everything from business promotion to topics on beauty. Her work can be found on various websites. She has a small-business background and experience as a layout and graphics designer for Web and book projects.