Paying mortgage bi-weekly as opposed to monthly

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kate156

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I am considering changeing my mortgage frequecy from monthly to twice per month and also overpaying by about 50 euro per month.
I understand it is better value to pay twice per month as opposed to once per month .Has anyone considered this .?
I have 235k outstanding as only 2 years into a 30 year mortgage.
 
Not all banks offer the service, I know AIB do...don't think EBS do though, I'm with them and my month goes out on the 7th. I couldn't see how you could save money on it, but I could be wrong....
 
Increasing the frequency of your payments will save some money in the long run. This is on the basis that banks calculate interset on the capital on a daily basis, so on a monthly mortgage payment plan, there are 29/30 days where you are not paying and where the bank is recalculating and compunding the interest every day.

Whilst some banks would not allow for anything other than monthly repayments in the past, I believe banks are now more flexible. Last year I changed my mortgage payments from monthly to every two weeks (weekly was not available). However, I ws able to change to weekly payments since last month. My mortgage is with BOI.
 
Paying bi-weekly will reduce a 30 year mortgage to approx 22 years, you are paying an extra months payment each year.
 
Do a search. This has been done many times before. As chum says above, the bulk of the saving comes from the fact that you are making effectively 13 monthly payments each year, rather than 12 e.g. you are making 26 fortnightly payments, rather than 24 fortnightly payments if you pay monthly.
 
Obviously you save more when you pay bi-weekly rather than twice a month as you make the extra repayments in the year but do you save much or cut your term by much if you just paid your mortgage twice a month rather than monthly.
 
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