Are There Advantages to Paying Weekly on a Mortgage?

Pay more money into your mortgage without even noticing.

Pay more money into your mortgage without even noticing.

Buying a home brings short-term headaches, but can ultimately lead you on the road to a better financial situation. Instead of paying rent to someone else, you can finally put more of your money to work for you. When you get a mortgage there will be plenty of creative ways for you to pay it off early. Making weekly payments is one way you could save years off your mortgage payments and not even miss the extra money you put in.

Fixed Rate Mortgage

Mortgages are commonly structured with a fixed interest rate and fixed payments over a predetermined period of time. Because your principal is so large at the beginning, most of your early mortgage payments will go towards paying the interest. On a 30-year mortgage of $300,000 at an interest rate of 4 percent, for example, your interest in the first month is $1,000 (0.04 / 12 * $300,000). That means of your $1,432.25 monthly payment, only $432.25 pays down your principal.

Weekly Payments

The approach is really quite simple. Take your monthly payment divided by four and pay that amount every week. The method is designed so that you’ll make payments to coincide with receiving your paycheck every week. Your payments will be more frequent but much smaller than a monthly payment, so chances are you won’t feel the sting as much, especially if it happens on the same day you get a paycheck. You can think of your weekly payment as just another payroll deduction.


Since there are 52 weeks in the year, by paying a quarter of your bill each week you’ll pay the equivalent of 13 monthly payments every year. That amounts to an entire extra mortgage payment every year. This will reduce your mortgage balance faster, which in turn saves you interest. Take your monthly mortgage payment of $1,432.25 which would amount to $17,187 annually. If instead you paid $358.06 every week, your monthly payment divided by four, you would pay a total of $18,619.12 per year. The interest you save by paying down your principal faster means you could be done making mortgage payments in less than 26 years instead of 30.


Make sure your lender lets you make extra payments on your mortgage without penalty. Some lenders don’t like it when you pay your mortgage off faster because they lose interest. Others are nice and will apply your payments as soon as they get them rather than waiting until your bill due date, shaving off even more interest. Also, if you get paid every two weeks, you can achieve a similar result by making a half payment every two weeks. You’ll still make that one extra monthly payment in total per year.

About the Author

Philippe Lanctot started writing for business trade publications in 1990. He has contributed copy for the "Canadian Insurance Journal" and has been the co-author of text for life insurance company marketing guides. He holds a Bachelor of Science in mathematics from the University of Montreal with a minor in English.

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