Quote:
Originally Posted by Sly
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Exactly. And it matches up to what I posted in my original post:
200K - 30 year mortgage at 5.125% = monthly payment: $1089 total interest paid: $192,252
200K - 25 year mortgage at 5.125% = monthly payment: $1184 total interest paid: $155,313
200K - 20 year mortgage at 5.125% = monthly payment: $1334 total interest paid: $120,235
If he was to amortize his loan at 25 years (in the example above) it would cause him to pay about $100 more a month, which equates to about 1 extra payment a year. In that case, if he paid the extra each month would mean he would pay it off in 25 years instead of 30.... reducing it by 5 years.
It is easy to use the calculator on the link i posted and just plug in how much a month, and let it show you exactly how much you pay each month and more importantly how much you save in interest. Since interest is compounded the quicker you pay it off the less you pay.
I doubt Mr. Real-estate license will come back in with proof to explain this he is obviously confusing this with something else. Any idiot can get a real estate license, I know I passed that test to get one years ago lol.