What Is a Biweekly Mortgage Calculator?

Interested in paying your mortgage off faster and paying less interest over the life of your loan? It may be time to start making biweekly home mortgage payments.

A regular monthly home mortgage payment is standard for a lot of lenders. On a monthly schedule, you make one mortgage payment every month, resulting in 12 home mortgage payments each fiscal year. When you pay your mortgage on a biweekly schedule, nevertheless, you pay half of a home loan payment every 2 weeks. Over the course of a year, this results in 26 half payments or 13 full mortgage payments - one additional payment compared to a monthly schedule.

Curious what a biweekly home mortgage payment may mean for your finances? Whether you're thinking of switching an existing home mortgage to biweekly payments or checking out a brand-new home loan, it's an excellent idea to get a clear image of your payment choices. Use our biweekly mortgage calculator to determine the difference that biweekly payments can make.

How Does the Biweekly Mortgage Calculator Work?

It's simple to utilize the biweekly home mortgage calculator. First, enter the following information:

Principal loan balance: If you have not started paying your home mortgage yet, this will be the overall loan quantity. If you've been paying your home mortgage, enter the loan balance that stays. Rates of interest: Enter the current rate of interest of your loan. Ensure to be exact to the decimal point. Loan term: The term of your loan is the variety of years till the loan is due to be paid off. If you have a 30-year loan, your loan term is thirty years. Enter that information here.

Once this details has been entered, all that's left to do is press "Calculate".

Next, it's time to see your benefit outcomes. The biweekly home mortgage calculator takes this details and generates two different estimations:

Monthly home loan payments: First, the biweekly home mortgage calculator informs you the details of what a monthly payment may appear like. It calculates your monthly payment amount, the overall interest you'll pay over the lifetime of your loan, and the typical interest you'll pay each month. Biweekly home loan payments: Next, the biweekly home loan calculator supplies the biweekly payment details. You'll see the biweekly mortgage payment amount, overall interest you'll pay over the life of the loan, and the typical interest paid per period. You'll discover that by making biweekly mortgage payments, you can reduce the total quantity of interest paid over the life of the loan.

Under the calculator results, the biweekly home loan calculator displays a chart of your loan balance gradually when utilizing month-to-month payments (the black line) versus biweekly payments (the red area), listed here as the "Accelerated Balance".

You'll see that with biweekly home loan payments, your loan balance will decrease at a much faster rate and you'll pay off your loan in less time. The more rapidly you pay off your loan, the less balance will remain that you need to pay interest on. That implies you'll pay less in interest over the life of your loan.

Benefits of Biweekly Payments

While the difference between a monthly versus biweekly home loan payment schedule may seem minimal, the extra month's home loan payment each year makes a big distinction in the long run. Benefits of biweekly payments consist of:

Paying off the loan much faster: Because there's an additional loan payment every year, borrowers who make biweekly payments settle their loans much faster than month-to-month payment borrowers. Paying less overall interest: Because the loan is paid off faster, less primary loan balance stays to pay interest on. With time, this results in substantially less interest paid. The higher your rate of interest, the more of a distinction paying biweekly can make in the amount of interest you pay. Building equity faster: As you settle your home mortgage, the quantity you paid off becomes your equity in your house. When you settle your mortgage more rapidly with biweekly payments, you'll develop equity quicker. This can be found in helpful if you decide to offer your home before the loan is paid off or if you wish to get a home equity loan, home equity line of credit, or cash-out refinance at some point.

Biweekly vs. Bimonthly Payments

Some loan providers also offer the option to pay a loan bimonthly. Borrowers who do so will pay half of their loan payments every month, generally on the 1st and 15th. Much like making a month-to-month home loan payment, this leads to 12 payments each year. The only distinction is that payments are made in half, twice monthly.

Making bimonthly home mortgage payments can help borrowers reduce the quantity of interest paid over the life of the loan. However, they do not have as huge of an effect as biweekly mortgage payments, which help you pay off your loan much faster, pay less interest in time, and construct equity in your house much faster.

That stated, bimonthly loan payments might be a great alternative for some. People who get paid on a bimonthly schedule may find this payment schedule favorable. Some might find that paying their loan instantly after getting their income works well for their money flow and budgeting efforts. Others might simply feel much better paying a smaller quantity twice each month, instead of paying a swelling amount all at as soon as.

Related Calculators

Interested in other tools to enhance your finances? We provide a series of calculators to assist you comprehend the financial effects of different kinds of loan payments, rate of interest, and more:

Blended Rate Calculator: Do you have several different loans with various rates? Our blended rate calculator averages these rates into a single rates of interest to help you better comprehend how much you're paying in interest. DSCR Calculator: Use this tool to quickly approximate your debt service protection ratio, which is an essential metric in determining your eligibility for a DSCR loan. VA Loan Calculator: Veteran home purchasers receive unique loans with a variety of benefits, like low loan rates, no down payment, and more. Use this calculator to determine what a VA home mortgage might look like for you. Bank Statement Loan Calculator: If you're self-employed or an independent contractor, use our bank declaration calculator to see what kind of mortgage you can get approved for using bank statements. 2/1 Buydown Calculator: Use our 2/1 buydown calculator to see if momentarily buying down your rates of interest is a sensible choice based upon your financial resources. Debt Consolidation Calculator: A debt combination loan rolls several debts into a single payment, generally with a lower rate. See what a loan like this might appear like based on your existing financial obligations. VA Loan Affordability Calculator: Estimate how much home you can afford when using a VA loan. Mortgage Payoff Calculator: See how changing your mortgage payment impacts your loan term and the amount of interest paid with our mortgage payoff calculator. Rent vs Buy Calculator: Unsure about whether you should rent or purchase? Our lease vs purchase calculator can assist you compare the brief- and long-term expenses included with both options.

Explore Flexible Mortgage Options

At Griffin Funding, we use flexible loaning options and an unrivaled client experience. In addition to conventional mortgage options like standard loans and VA loans, we likewise use a large range of non-QM loans.

Wish to find out more about your home loan alternatives? Reach out today and we can assist you find a home loan that best aligns with your present financial resources and long-term objectives.

Find the best loan for you. Reach out today!

Frequently Asked Questions

Is it better to do month-to-month or biweekly home loan payments?

Finding the ideal payment schedule depends on your specific needs. Biweekly home mortgage payments might be a better option if:

You can afford to pay more money each year: On a biweekly payment schedule, you'll be making one additional home mortgage payment each year. It is essential to figure out whether there's room in your budget plan for this cost. You desire to pay your loan off faster: Depending upon the regards to your loan, making biweekly payments will allow you to settle your loan much more rapidly. Use our biweekly home loan calculator with additional payments to see how additional payments impact your loan term. You wish to pay less interest: Because you pay off your loan faster with biweekly mortgage payments, your loan will have less time to accrue interest and you'll pay less interest with time. This can be especially beneficial to those with a fairly high mortgage rate.

What are the drawbacks of making biweekly home loan payments?

The primary disadvantage of biweekly home mortgage payments is the higher yearly expense. Because you make 26 half-payments throughout a year, or 13 complete mortgage payments, you'll make one extra loan payment annually. Depending upon your loan and financials, the extra payment can be a significant burden to take on.

Sometimes, biweekly payments may include additional costs. Some home loan lenders charge an additional charge for biweekly payments or charge a penalty for loans that are settled early. It's a great concept to research whether changing to biweekly payments with your lender has any associated fees so that you can determine the true expense of biweekly payments.

Does making biweekly payments reduce the amount of interest I pay?

Yes. By switching to a biweekly payment schedule, you'll pay much less interest over the term of your loan. Interest accumulates as a percentage of your loan's remaining balance. Because biweekly payments lower your staying balance at a sped up speed, the interest on the balance will be less, too.

Use our mortgage calculator for biweekly payments to see the distinction in total interest paid on a mortgage that's paid regular monthly vs a mortgage that's paid biweekly.
bloglines.com
Bill Lyons is the Founder, CEO & President of Griffin Funding. Founded in 2013, Griffin Funding is a national shop mortgage lending institution focusing on delivering 5-star service to its clients. Mr. Lyons has 23 years of experience in the mortgage organization. Lyons is viewed as a market leader and professional in realty financing. Lyons has been featured in Forbes, Inc., Wall Street Journal, HousingWire, and more. As a member of the Mortgage Bankers Association, Lyons is able to keep up with important changes in the market to provide the most worth to Griffin's clients. Under Lyons' leadership, Griffin Funding has actually made the Inc.
.