Biweekly Mortgage

  

A mortgage where you can make payments every two weeks instead of the usual once a month.

No, that doesn’t mean you’re paying double every month. What it really boils down to is making the equivalent of 13 monthly mortgage payments a year instead of the usual 12, just because you pay half of your payment two weeks early every month (you make 26 payments...one every two weeks for 52 weeks in the year).

Making payments sooner rather than later means you’ll pay off the interest faster, which also means you’ll pay a lot less interest over the life of the loan. If you’re looking to save money, so you can buy that gold $$$-sign chain, look into a biweekly mortgage.

Related or Semi-related Video

Finance: What is a Reverse Mortgage?6 Views

00:00

Finance allah shmoop What is a reverse mortgage All right

00:07

people let's start with a normal mortgage You put one

00:09

hundred grand down borrow three hundred grand and are the

00:12

proud new owner of this baby in palo alto california

00:15

You make payments for thirty years at five percent interest

00:18

and then you retire their debt free So that's a

00:21

mortgage but what's a reverse mortgage Like one of these

00:25

egg trump Well kind of at least financially the payments

00:29

go in the opposite direction of a normal mortgage Like

00:32

you're old you just want to live out your remaining

00:35

years with the basic comforts Shower seats stair lift high

00:39

absorption adult diapers You own all of your home No

00:43

mortgage on it You paid it all off The home

00:45

is now worth a million box Nice shoebox There you

00:49

can do a reverse mortgage pledging your home is an

00:53

asset and basically just receiving a payment of l say

00:56

five grand a month from that reverse mortgage and you'll

01:00

get to deduct interest costs as you go Justus if

01:03

it were a normal mortgage well after forty months you

01:07

you know croak in that time period you've taken out

01:09

Forty times five grand or two hundred grand in loans

01:12

plus some interest and you sell your home for a

01:15

cool million Rather your heirs dio So what happens now

01:19

Well they just take the million bucks from the sale

01:21

write a check for two hundred grand and change to

01:24

the bank to pay off the reverse mortgage that you

01:27

had accrued while you were you know wasting away to

01:29

nothing and your heirs end up happy like they miss

01:33

you But you know a free stair lift Who are 00:01:37.997 --> [endTime] you

Up Next

Finance: What is a Mortgage?
345 Views

What is a mortgage? A mortgage is a loan on property. Obviously not many individuals, or companies for that matter, can or want to pay cash for the...

Finance: What is Adjustable-Rate Mortgage (ARM)?
17 Views

What is an Adjustable-Rate Mortgage (ARM)? An adjustable-rate mortgage is a mortgage that has a changing interest rate. Whatever it changes to is b...

Finance: What is Interest Only Mortgage?
17 Views

An interest-only mortgage is a mortgage on which you only pay the rent on money borrowed, rather than on the principal.

Finance: What is a second mortgage?
4 Views

What's a second mortgage? Easy: it comes after a first mortgage. Hit play for more details.

Find other enlightening terms in Shmoop Finance Genius Bar(f)