What effect does paying off a mortgage or loan twice monthly rather than one payment monthly.?

Answers:3   |   LastUpdateAt:2012-09-30 13:04:02  

Question
freak on a leash
Asked at 2012-09-01 09:43:03
If you have a monthly loan payment of, say 1000, but provides for a refund of 500 to 500 at the beginning and end of every month what is the effect on the interest and repayment term .
Answer1fazilah edwinAnswered at 2012-09-05 12:21:07
It does not help when you are paying the same amount each period .
Answer2blackbirdAnswered at 2012-09-09 20:51:02
Hello , MedlinePlus if you are paying twice a month , then you will only be charged with the interest you agreed on the principle of the loan . The creditor will not be able to charge additional fees or late payment , as it will be on par with you repayments . If you just need to know if the interest is charged on a monthly or yearly basis . It would then be easy to calculate
Answer3GoomarAnswered at 2012-09-30 13:04:02
It depends on whether the interest is accrued daily or monthly . MedlinePlus MedlinePlus If daily , then it will be the equivalant of being charged interest on the extra 500 per month. MedlinePlus MedlinePlus If you are thinking of either putting money into savings for the month or for the loan earlier this month , you would have to do the sums of the rates of interest that you think is going to be charged. I would think that the 1000 payment earlier this month is more beneficial , especially with the level of global interest rates are less .
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