Can You Pay Your Mortgage Weekly to Pay It Off Faster?

Homeowners often seek ways to manage their mortgage payments more efficiently, with “weekly” payments sometimes coming to mind as a strategy to accelerate payoff. While the idea of true weekly mortgage payments is a common inquiry, the more practical and widely available approach for accelerating mortgage payoff involves a bi-weekly payment schedule. This method allows homeowners to reduce the total interest paid and shorten the loan term over time.

Understanding Mortgage Payment Frequencies

A standard mortgage payment schedule involves one payment per month, totaling 12 payments over a year. This monthly structure is convenient for many homeowners, aligning with common billing cycles and budgeting practices. However, this traditional approach may not be the fastest way to reduce the overall interest burden on a loan.

Many individuals inquire about “weekly” mortgage payments, but what they often mean, and what is commonly offered by lenders, is a bi-weekly payment plan. Under a bi-weekly arrangement, a homeowner makes half of their standard monthly payment every two weeks. This results in 26 half-payments annually. Since there are 52 weeks in a year, this effectively equates to 13 full monthly payments made over the course of 12 months.

The Mechanics of Accelerated Payments

Implementing a bi-weekly payment schedule accelerates the reduction of the principal balance. Each bi-weekly payment, half of the regular monthly amount, is applied to the loan every 14 days. This more frequent application of funds reduces the principal balance more often than with a traditional monthly schedule.

The core financial advantage is that a bi-weekly payment plan results in an extra full monthly payment each year. For example, a $1,200 monthly payment becomes $600 bi-weekly. Over 26 payments, this totals $15,600 annually, compared to $14,400 for 12 monthly payments. This additional annual payment directly targets the principal, leading to a faster reduction of the outstanding balance.

Interest on mortgage loans is calculated based on the outstanding principal. By reducing the principal more frequently and with an additional payment each year, less interest accrues over the loan’s life. This consistent principal reduction means a smaller amount is subject to interest charges, leading to substantial savings on total interest paid and a shorter loan duration. This strategy can shave years off a mortgage, allowing homeowners to build equity more quickly and potentially save thousands of dollars in interest.

Setting Up More Frequent Payments

To implement a bi-weekly payment schedule, homeowners should contact their mortgage lender or loan servicer. Inquire about their specific policies, as not all lenders offer the same options. Some lenders may have a dedicated bi-weekly payment program, while others might require manual extra payments.

Lenders often offer automatic bi-weekly deductions directly from a bank account. Homeowners should confirm these extra payments will apply directly to the loan’s principal balance, not simply held until the next monthly due date or applied to future interest. Some lenders might charge a fee or have specific requirements for participation. If a lender does not offer a formal bi-weekly program, homeowners can still achieve similar benefits by making an extra principal payment equivalent to one-twelfth of their monthly amount each month, or by making one additional full mortgage payment annually.