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How Quickly Can I Pay Off My Mortgage?

Let’s face it, getting a mortgage means that you’ll have to pay monthly payments for 15-30 years or until it’s paid off in full. This can be daunting for new homeowners who want to get their first property.

But how quickly can you pay off your mortgage?

If you want to pay off your mortgage quickly, start by making biweekly payments. For instance, if you have a mortgage payment of $2,000. You can start by paying it off $1,000 every two weeks. Just make sure you don’t pay too soon, or you’ll have a prepayment penalty.

Doing this will help you reduce your mortgage faster than paying monthly installments. Throughout this article, we’ll explain why paying it off early is better for you in the long term. So let’s get started.

How Quickly Can I Pay Off My Mortgage 

While you can make monthly installments to pay off your mortgage, you can pay it off even faster. You can start by making bi-weekly payments or adding an extra payment annually to make sure your mortgage is paid off on time. 

But, if you are planning on paying off your mortgage early, it’s best to speak to your lender beforehand. Based on your loan terms, you could potentially have a prepayment penalty.

Usually, most mortgage lenders cannot impose a prepayment penalty due to the Dodd-Frank Act. However, if your mortgage doesn’t meet that exception, the prepayment plan can only be assessed in 3 years.  

The prepayment penalty is capped at 2% for the first two years and 1% for the third one. That means that if your outstanding loan balance is $100,000 in the second year, expect to pay a $1,000 repayment fee. 

Mortgage rates have been reduced over the past few years. So if you pay off your mortgage early and it’s equal to your interest rate, then the return wouldn’t be good in comparison to the S&P 500 (10% return in the past 90 years)

Alternatively, you could use the cash you’d use for your mortgage property and use it as leverage for a cash-flowing property. For instance, some people use these payments for properties such as:

  • Single Family Home
  • Multi Family Home
  • Commercial Property

However, any of these choices can become risky. Even when you’ve paid off your mortgage early, you could experience a potential loss if the real estate prices drop. You’re better off not paying off the loan early most of the time.

Paying off your mortgage early gives you more peace of mind. If you have full ownership of your house, it can give you benefits that are not measured in financial terms. Eliminating the mortgage before retirement is a great plan for some people, especially if they’re on a fixed income. 

Another advantage is to borrow against your home’s equity. Having home equity can establish HELOC (Home equity line of credit). The HELOC gives you access to emergency funds, home improvements, and other forms of investments.

Always try to speak to your lender before paying off the mortgage early. Doing so will help you save money on prepayment fees and come up with a plan to pay it off within a timely manner. 

Why Should I Pay Off My Mortgage Quickly?

Reduced Interest Rates

Every month that you make a mortgage payment, a portion of that money is going to interest. This means that the fewer payments you have, the less interest you’ll have to pay. 

When paying off your mortgage, speak with your lender about the extra payments. Tell them that your extra payments are going towards the principal and not the interest. 

Complete Home Ownership

If you experience a financial emergency, there’s a chance you can’t afford your monthly mortgage payments. If you cannot make those payments on time, you’ll default on the loan. You’ll have complete ownership of your property by paying off your mortgage. 

No Monthly Payments

The monthly payments can be a financial burden on some. By freeing up your income for monthly payments, you can use that extra money to pay for your child’s tuition or invest it in another property. 

Reduced Base Expenses

You should pay off your mortgage quickly if the monthly mortgage payment represents most of your expenses. After you’ve paid it off, you can live with a lot fewer issues. This can be a great option if you have less income. 

Consider getting your mortgage paid off quickly if you have the financial means to do so. While it might cost extra prepayment fees, it will free up your financial capital in the long run. Speak with a financial advisor and lender before making any new decisions. 

Risks of Early Mortgage Payments

Harms Your Credit Score

Multiple factors make your credit score. For instance, you might have a car loan, mortgage, or credit card. By removing one form of credit, your credit score will drop. 

Payment Penalties

As stated earlier, paying off the mortgage too early will lead to a prepayment penalty. Not all mortgage lenders have this fee, and you don’t have to worry about it if you have to wait more than five years to pay it off. 

Always ask your lender first before making this purchase. That way, you can make sure you have the right payment plan to pay off the mortgage within a reasonable time frame. 

No Tax Deduction

As a homeowner, you can claim your mortgage as a tax deduction. However, this feature goes away once you pay off the mortgage early. 

Because of these risks, it’s essential to speak with a lender before taking out a mortgage. Understand how to become qualified for one and pay it off correctly. When in doubt, just pay off your mortgage monthly to prevent any prepayment fees. 


To conclude, you can quickly pay off your mortgage through bi-weekly payments. Before you do this, contact your lender if this is possible without prepayment fees. That way, you can clear your mortgage loan early and get closer to enjoying full ownership of your property.