Normally, with monthly payments, you'd be making 12 payments per year. Over and over again.Ĭonsider a mortgage with a principal amount of £200,000 and an interest rate of 4% over a 30-year term. How do weekly mortgage payments affect mortgage interest paid?Īs Mortgage interest is calculated daily, it means you save the interest you would have paid on the repayment capital for up to 4 weeks. It's important to note that the exact interest savings will depend on factors such as your mortgage interest rate, loan amount, and remaining term.īy making more frequent payments and reducing the principal balance faster, you'll have the potential to significantly decrease the total interest paid over the life of your mortgage. This means you'll not only save on interest but also achieve homeownership and financial freedom sooner. As you consistently chip away at the principal balance, you may be able to pay off your mortgage earlier than the originally agreed-upon term. Making weekly payments can also lead to a shorter loan term.
Have a play with a Mortgage calculator to find out what differences paying your mortgage back sooner can back in terms of interest. This can result in substantial interest savings over the term of your mortgage. Since the principal balance is reduced more quickly with weekly payments, the amount of interest that accrues on the remaining balance decreases as well. With each payment, a portion goes towards the principal amount owed on your mortgage.Īs a result, the principal balance decreases faster than with monthly payments alone. Here's how it works: Reduced principal balanceīy making weekly payments, you are effectively reducing your outstanding loan balance more frequently. Making weekly mortgage payments can have a positive impact on the amount of interest you pay over the life of your loan. How can making weekly mortgage payments help? What Are Accelerated Weekly Payments UK?Īccelerated Weekly Payments is a financial option allowing borrowers to make weekly repayments rather than monthly, leading to quicker repayment of not only mortgages, but also loans.īy making more frequent payments, borrowers reduce interest accrual and shorten the loan term, potentially saving on overall interest costs. The goal of weekly mortgage payments is to accelerate the repayment process, reduce the total interest paid over the loan term, and potentially shorten the overall duration of the mortgage.īy making more frequent payments, homeowners can make steady progress in paying down the principal balance and ultimately achieve mortgage freedom sooner. This approach results in 52 payments per year, compared to the usual 12 monthly payments. It involves dividing the monthly mortgage payment into four equal parts and making a payment each week. Some lenders may not offer weekly mortgage payments.Ī weekly mortgage payment is a payment method where homeowners make mortgage payments on a weekly basis instead of the traditional monthly payments. Whilst weekly mortgage payments may sound appealing, it's essential to check with your lender as each lender has its own policies and repayment options.