A biweekly mortgage is a home loan whereby the borrower makes half the monthly payment amount every two weeks.
This is a proven method of paying off a housing loan quicker while saving on interest costs.
The dynamics that result in this phenomena is due to there being 52 weeks a year, working out to 26 payments annually.
This means that a borrower would be making 12 and a half payments a year compared against a regular monthly mortgage.
It also means that a monthly payment loan that would take 25 years to fully repay will take a biweekly mortgage 24 years.
1 year less.
The extra payments will reduce the outstanding balance of the loan faster, while bringing about a more significant rate of savings compared to a bimonthly mortgage.
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