T. Jay Johnson Jr. - RE/MAX Property Promotions



Posted by T. Jay Johnson Jr. on 7/12/2019

Paying off a mortgage early is a dream of many homeowners. By making larger payments on your home loan, you can cut years off of your loan term and save thousands of dollars in interest payments that you can use toward savings or investments. But in an economy that has seen decades of wage stagnation and increasing costs of living, it can often seem like an unattainable goal.

With some planning and initiative, however, there are ways to pay off your home loan before your term limit.

In today’s post, we’re going to talk about three of the ways you can start paying off your mortgage early to avoid high interest payments and save yourself money along the way.

1. Refinance your mortgage

If you’re considering making larger payments on your mortgage, it might make sense to look at refinancing options. Most Americans take out 30-year, fixed-rate mortgages.

If you can afford to significantly increase your mortgage payments each month, you could refinance to a 15-year mortgage. This will save you on the number of interest payments you’ll have to make over the years. But, it will also help you secure a lower interest rate since shorter term mortgages typically come with lower interest rates.

This option isn’t for everyone. First, refinancing comes with fees you’ll have to pay for upfront. You’ll have to apply for refinancing, get an appraisal of your home, and wait for the decision to be made.

But, you’ll also have to ensure that you can keep up with your higher monthly payments. If your income is variable or undependable, it might not be the safest option to refinance to a shorter term mortgage.

2. Make extra payments

An option that entails less risk than refinancing is to simply increase your monthly payments. If you recently got a raise or are just reallocating funds to try and tackle your mortgage, this is an excellent option.

Depending on your mortgage lender, you may be able to simple increase your auto-pay amounts each month, streamlining the process. Otherwise, it’s possible to set up bill-pay with most banks to automatically transfer funds to your lender.

3. Bi-weekly payments or one extra payment per year

Making bi-weekly instead of monthly payments is an option that many homeowners use to pay off their mortgages early. Bi-weekly payments work by paying half of your monthly payment once every two weeks.

The vast majority of homeowners make 12 monthly payments per year. But by switching to 26 bi-weekly payments, you can effectively make 13 full monthly payments in a year without seeing too much of a difference in your daily budget.

This doesn’t seem like much savings in the short term, but let’s take a look at how much you could save over the term of a 30-year mortgage.

On a 30-year fixed mortgage of $200,000 with a 4.03 annual interest rate, you would make a monthly payment of $958.00 and a bi-weekly payment of $479.

Over 30 years of an extra monthly payment, you could save nearly $20,000 on the total interest amount and pay off your mortgage almost 5 years early.




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Posted by T. Jay Johnson Jr. on 4/19/2019

The factor that has the most impact on your home search is your finances. You’ll need to save a significant amount of money. It’s not easy to save when you have continuous monthly bills and responsibilities. Read on for tips on how to get your finances under control in order to save the amount of money it takes to buy a home.  


Do A Budget  



Once you have decided to buy a home, the first thing you should do is take a good look at your finances. A budget is critical when you buy a house because it tells you how much you’ll have to spend on your mortgage. Doing this ahead of time will allow you to maximize your income and make adjustments ahead of time as needed. Don’t forget that even though you’re buying a home, you still need some savings in addition to all of your other monthly expenses. Your budget should be outlined as follows:


  • Necessities
  • Monthly utility spending 
  • Insurance bills
  • Entertainment expenses
  • Grocery spending


Basically, you want to write down how much money is coming in and where all of the money is going. That’s a budget in a nutshell. See where you can cut back. What you’re left with is the amount you can save each month. You may want to do this on a percentage basis rather than a flat dollar amount. 


Get A Separate Account


The most straightforward things to do when you start saving for a home is to put all of your money for your house fund into a separate account. This way you can automatically transfer money in, and you’ll be less likely to spend any of the money if you don’t see it.


Sacrifice The Small Things


Can you take some hand me downs for your kids? Maybe you can start packing a lunch for work instead of buying lunch. Can you cut the cord on cable? It may be hard to sacrifice small luxuries, but these expenses can add up. If you cut these out of your budget, you’ll have a little more wiggle room to save for a home purchase. You’ll be surprised how much money you can save just by doing little things. Your morning latte is probably around $5. You could save at least $25 per week by merely making coffee at home! That’s a saving of over 1,200 per year!   


While saving for a home can seem overwhelming, if you take it in small chunks, you’ll be see the results of your efforts rather quickly. 





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Posted by T. Jay Johnson Jr. on 10/6/2017

Depending on where you live, groceries can be one of the top expenses in your household. Frugal shoppers have found many ways to save at the grocery store over the years, from coupons to price matching. However one of the best ways to save money on groceries and household items is to bulk buy. When you buy items in bulk you give up a small amount of storage space at home, but you gain savings in return. Plus buying in bulk means you're using up less packaging in the long run, helping the environment out as well. Here are the items you should buy in bulk and the items you should avoid.

Food

Whether you have a BJ's or Sam's Club membership or if you seek out good deals online or at your local grocery store, there are a number of food items you can buy in bulk to save money.
  • Cereal. Buying oversized boxes of cereal, especially knock-offs of name brands can save you more than 50% on prices.
  • Rice and beans. Buying food staples in bulk are a great way to save at the grocery store. Rice and beans can be used in any number of dishes for tastes from around the world. They offer meals high in fiber and protein and rich in nutrients.
  • Oatmeal. Large boxes of dried oatmeal will allow you to save money and make your own creations. Add dried or frozen fruit, nuts, cinnamon, or yogurt to your morning oatmeal to keep things interesting.
  • Frozen vegetables. Not only are frozen vegetables cheaper and more convenient, but they often contain more vitamins and nutrients than fresh vegetables because they are frozen immediately after being harvested.

Other home goods

Hand soap. Rather than buying new containers of hand soap every time you run out, wasting money and plastic, buy one large bottle of your favorite soap and refill the bottles in your kitchen and bathrooms. Trash bags. Trash bags bought in bulk don't take up much more room than smaller boxes and you'll get much more for your dollar. Toilet paper. Buying toilet paper in bulk will save you a lot of money. Try storing the huge pack in the basement rather than the bathroom closet, keeping just one or two extra rolls in the bathroom to save space. Toothpaste and toothbrushes. Toothpaste is a well known bulk-buy, but toothbrushes bought in packs of 2 or more are also a great way to save. Set a reminder in your phone to change toothbrushes at least once every three months.

Things not to buy in bulk

Condiments. The temptation is there to buy a huge bottle of honey mustard and save a few cents. But unless you eat it every day, odds are your condiments will expire before you use them and take up a ton of room in your refrigerator. Plastic tupperware. Rather than buying cheap plastic tupperware at the grocery store every few months, buy one good glass set that will last years. Fresh fruit. It's tempting to buy that huge bag of clementines, but you'll be kicking yourself when they start to rot and hardly any have been eaten. You're better off stopping at the store and buying small amounts of fresh fruits when you want them rather than assuming you'll eat them.  





Posted by T. Jay Johnson Jr. on 9/30/2016

Kitchens sell houses. So having a great looking kitchen is important if you are thinking of putting your home on the market or maybe you just need a fresh new look. Cabinets are one of the biggest expenses in a kitchen remodel but with a little elbow grease and creativity, you can update your kitchen cabinets without going through the hassle of an entire remodel. Here are some tips on how to make your kitchen look like new with a cabinet facelift. Give the wood a Good Cleaning You will be surprised what a good scrubbing can do. Heat, water, grease and food residue all take a serious toll on your cabinets.

  • If you choose to remove the doors, label or number them so you'll put them back in the right place.
  • Make sure to test any kind of cleaner before using it on the entire cabinet. Cleaners with large amounts of alcohol may cause the wood to dry and crack.
  • Clean and Update the Hardware Hardware gets greasy and grimy so make sure to clean those too.
  • Soak the hardware in a soapy-water solution for 30 minutes.
  • Scrub lightly with a soft brush and rinse.
  • Let dry and apply the proper polish.
  • You may decide instead to replace the hardware. In choosing the finish for your hardware, think about what style will look best in your home. Add Some Detail Add some detail to drab cabinets with moulding. Applying a contrasting finish or color is a quick and inexpensive way to change the look of your cabinets. Stripping and Refinishing If after cleaning your cabinets still need some help, you may decide to refinish or paint them
  • Make sure to remove all the cabinet doors and number them.
  • Liquid strippers work best, but be sure to use the gel or semi-paste types.
  • Place doors on a vertical surface. The finish won't drip as much.
  • Let the stripping agent do the work and start with an inconspicuous area.
  • Patch any conspicuous holes, scratches and nicks with wood filler. When dry, sand lightly to smooth out the patch. Before painting, sand lightly and prime.
  • Before painting remember that the wood expands and contracts with the seasons, which will cause the paint bead to separate and expose unpainted wood. So with a little hard work you can have a whole new look to your kitchen in no time.




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    Posted by T. Jay Johnson Jr. on 8/12/2016

    Money experts recommend having an emergency fund, however, that is easier said than done. You will want to have at least three to six months of living expenses in your emergency fund. Here are some tips on how to get there: Determine how much you need                                                                                               Calculate how much you spend each month. Add up your rent/mortgage, car payments, insurance, food and utilities. This will give you an idea of how much you will need to save. Start small If you find it hard to save, start by saving small amounts. Even if you only saved $20 per week for one year, you would increase your savings account by $1040.00 Have achievable goals                                                                                                                     Start with a small goal and gradually work towards a larger one. Set your initial goal of one month's savings and build upon that. If you start small and make savings a habit it will be easier to save. Make it automatic                                                                                                                           Set up automatic contributions to your savings account. Move a specified amount of money to your savings account through direct deposit. If you do this you may not even miss the money. Watch where your money goes                                                                                                 Keep track of how much money you spend. Calculate your spending average and try to spend less. Another great way to save is to find areas where you can cut back. What are some of your best tips for saving money?  




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