Weekly or monthly payments - does it matter?

Couple moving in to their new home

When the time comes to hunt for a home, one of the decisions you will have to make is how frequently you will make you mortgage payment.

At Cambrian, all of our mortgages can be set up with weekly, bi-weekly, semi-monthly or monthly payments.

When working with our members, we will look at when they get paid because most people like to match up their mortgage payments with their pay days. When working with a couple, we might look at setting up weekly payments if they have opposite pay weeks. Ultimately, the mortgage payment schedule can be tailored to each person’s situation.

Making bi-weekly mortgage payments means you are taking your monthly mortgage payment, multiplying it by 12, then dividing it into 26 equal payments. You are paying the same amount as you would with monthly payments, but by making more frequent payments, you can save a lot of interest costs over the lifetime of your mortgage.

Want to save even more money on interest? Consider increasing the frequency to weekly, for example. You can also set up accelerated biweekly payments that allows you to make an extra monthly payment every year, letting you pay your mortgage off sooner than planned.

Another way to save money and pay your mortgage off sooner is to make prepayments.

At Cambrian, we allow members to pay an extra 20% of the original mortgage balance per year, without penalty, with the flexibility to do this at any time during the year. Some people choose to increase their regular payments, which means that anything above the required mortgage payment is applied directly to principal, or you can make an extra principal payment as a lump sum when you have some extra money.

For more information about Cambrian mortgages, click here.