The KEY word is ACCELERATED bi-weekly.

Most financial institutions offer a number of payment options (monthly, semi-monthly, bi-weekly, accelerated bi-weekly, weekly, and accelerated weekly payments). Although these options may all seem the same, some payment methods such as accelerated weekly and bi-weekly payments can save you a lot in interest charges, compared with regular monthly payments.

The following table illustrates the savings in interest you can get with various payment options. It assumes that you have a mortgage of $150,000, amortized over 25 years, with a constant interest rate of 6.45 per cent. As you will note, choosing the accelerated weekly or bi-weekly payment option can save you thousands of dollars in interest charges over the duration of your mortgage.

Monthly

With monthly payments, funds are taken from your account on a specific day once a month (or 12 times a year); for example, on the first day of each month. This type of payment does not result in any interest savings when compared to the other payment options that follow.

Semi-monthly

If you choose the semi-monthly payment option, half of your monthly payment amount will be taken from your account twice a month (e.g., on the 1st and 15th of each month), and you will make 24 semi-monthly payments a year. This type of payment does not result in any significant interest savings.

Bi-weekly (non-accelerated)

With the non-accelerated bi-weekly payment, you make a payment every second week (e.g., every second Thursday). Since there are 52 weeks in a year, you will make 26 payments a year (52 weeks ÷ 2). To calculate the amount of your bi-weekly payments, multiply your monthly payment by 12 and divide it by 26 ($1,000 × 12 ÷ 26 = $461.54). This type of payment does not result in any significant savings in interest.

Weekly (non-accelerated)

With the non-accelerated weekly payment, you make a payment every week (e.g., every Thursday). Since there are 52 weeks in a year, you will make 52 payments in a year. To calculate the amount of your weekly payments, multiply your monthly payment by 12 and divide it by 52 ($1,000 × 12 ÷ 52 = $230.77). This type of payment does not result in any significant interest savings.

Accelerated bi-weekly

The accelerated bi-weekly payment allows you to pay half of your monthly payment every two weeks (e.g., every second Thursday). Since there are 52 weeks in a year, you will make 26 payments a year (52 weeks ÷ 2). By doing this, you make the equivalent of one extra monthly payment a year, which means you pay off your mortgage faster and save interest charges.

Accelerated weekly

If you choose the accelerated weekly payment, one-quarter of your monthly payment amount will be debited from your account every week (e.g., every Thursday). Since there are 52 weeks in a year, you will make 52 payments a year. As with the accelerated bi-weekly option, you make the equivalent of one extra monthly payment a year, which means you pay off your mortgage faster and save on interest charges.

Call me to discuss 604-273-2002

Mark Fidgett | 604-273-2002

“Your Personal Mortgage Consultant….For Life!”

PS – Please Don’t Keep Me a Secret

A REFERRAL is when you INTRODUCE someone you care about to someone you TRUST!

T 604.273.2002 | F 604.522.2072

W http://www.notapennydown.com

An independent Mortgage Specialist associated with the Verico Mortgage Network.

ENJOY : )

Mark Fidgett | 604-273-2002

“Your Personal Mortgage Consultant….For Life!”

PS – Please Don’t Keep Me a Secret
A REFERRAL is when you INTRODUCE someone you care about to someone you TRUST!

T 604.273.2002 | F 604.522.2072
W http://www.notapennydown.com

An independent Mortgage Specialist associated with the Verico Mortgage Network.