If I owe $161,965.21 on my house, my interest rate is 4.5%, it was a 20 year loan a year ago when it started (I think the loan was about $171,000 a year ago) – my principal and interest due every month is $1093.07 and my escrow is $158.74 every month – which makes my payment $1251.81/month.
Every month I pay $1600 even though my payment should be $1251.81. On my most recent payment, $830.78 went to principal, and $610.48 went to interest and $158.74 went to Escrow.
So my question is let’s just say I decide to put a lump sum payment of $20,000 on my next house payment. How does this affect my monthly interest payment every month going forward? How much money will go toward principal that wouldn’t have every month assuming I continue making $1600 payments on this loan?
Every month I pay $1600 even though my payment should be $1251.81. On my most recent payment, $830.78 went to principal, and $610.48 went to interest and $158.74 went to Escrow.
So my question is let’s just say I decide to put a lump sum payment of $20,000 on my next house payment. How does this affect my monthly interest payment every month going forward? How much money will go toward principal that wouldn’t have every month assuming I continue making $1600 payments on this loan?
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If you add $20,000 to your next house payment, the principal will be $20,000 lower, so the interest for the next month will be $75 lower. The difference in interest will increase from month to month, simply because the next month's principal will be $20,075 lower, rather than "only" $20,000.
If you pay $21,600 next month, the principal after the payment will be $141,131.32. If you continue to make payments of principal and interest of $1,441.26 (that's what you're paying now: $1,600 minus the $158.74 payment to escrow, which I'd guess is for property taxes), you will have your house paid off in another ten years and three months.
If you pay $21,600 next month, the principal after the payment will be $141,131.32. If you continue to make payments of principal and interest of $1,441.26 (that's what you're paying now: $1,600 minus the $158.74 payment to escrow, which I'd guess is for property taxes), you will have your house paid off in another ten years and three months.