How to pay off a mortgage early

Pay any amount above your scheduled payment, marked as principal. Even $100 a month compounds dramatically. Set it up as automatic so it happens without willpower. This works for any fixed-rate mortgage and never costs anything extra.

Pay half your monthly amount every two weeks. There are 26 biweekly periods per year, so you make 13 monthly payments instead of 12 — roughly one extra payment of principal annually. Confirm your servicer applies the half-payment correctly; some hold biweekly funds and apply them as one monthly payment, which provides no benefit.

Treat occasional cash inflows as one-time principal payments. A $5,000 lump sum applied today saves interest on that $5,000 for the rest of the loan. The earlier in the loan you do it, the more interest you avoid.

After a large lump sum (often $10k+), some servicers will recast the loan: re-amortize the remaining balance over the same rate and remaining term, lowering your required monthly payment. You don't shorten the term — but if you keep voluntarily paying the old amount, you accelerate payoff and have a lower fallback payment.

If rates have dropped, refinance into a 15- or 20-year loan. The payment usually goes up, but the rate is lower and the payoff comes much sooner. Make sure monthly savings vs. the new term, plus closing costs, line up with how long you actually plan to stay.

• You haven't maxed out tax-advantaged retirement accounts yet.
• You don't have a fully-funded emergency fund.
• You have higher-rate debt (credit cards, personal loans).
• Your mortgage rate is well below safe-investment yields and you have the discipline to actually invest the difference.