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Bi-Weekly Payment Formula:
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Accelerated bi-weekly mortgage payments involve making half of your monthly mortgage payment every two weeks. This results in 26 half-payments per year, equivalent to 13 full monthly payments, which helps pay off your mortgage faster and save on interest.
The calculator uses the simple formula:
Explanation: By dividing your monthly payment by two, you make payments every two weeks instead of once per month, accelerating your mortgage payoff.
Details: Making bi-weekly payments can reduce your mortgage term by several years and save thousands of dollars in interest over the life of the loan due to more frequent principal reductions.
Tips: Enter your current monthly mortgage payment amount in dollars. The calculator will compute your bi-weekly payment amount automatically.
Q1: How much faster will I pay off my mortgage?
A: Typically, a 30-year mortgage can be paid off in about 24-25 years with accelerated bi-weekly payments.
Q2: How much interest can I save?
A: Savings can range from 20-30% of total interest paid over the life of the loan, depending on your interest rate and loan amount.
Q3: Are there any fees for switching to bi-weekly payments?
A: Some lenders may charge setup fees, while others offer this service for free. Check with your mortgage provider.
Q4: Can I switch back to monthly payments?
A: Most lenders allow you to switch payment schedules, but there may be restrictions or fees involved.
Q5: Is this different from semi-monthly payments?
A: Yes, bi-weekly means every two weeks (26 payments/year), while semi-monthly means twice per month (24 payments/year).