See how bi-weekly payments can make it easier to pay off loans fast.
One of the simplest ways to eliminate debt faster is to switch to a bi-weekly payment schedule; that means you make two extra payments every year. As a result, you can eliminate your debt faster and save money on interest charges. This is most commonly seen with mortgage debt.
How bi-weekly payments work
With a monthly payment schedule, you make 12 payments in a year but with a bi-weekly payment schedule you’ll make 26 payments in a year (52 weeks, divided by 2), and because you make 26 payments instead of 24. This means there will be fewer months for the lender to charge interest and you’ll wind up paying off more of the debt each year.
Monthly vs Bi-weekly Payments Calculator
Why bi-weekly payments are effective
For every year you use a bi-weekly schedule, that’s one less month of added interest on your loan or line of credit. With a bigger loan like a mortgage, you’ll save thousands on added interest with a bi-weekly payment plan.
The calculator above is designed to help you assess the value of a bi-weekly repayment schedule vs. a monthly repayment schedule. Enter the current balance on the loan and the remaining term (the number of months to final payoff). If this looks like a good option, call your lender to see if you can make the switch.
