3 ways to get paid back for making mortgage payments
If you're one of those people who dreads coughing up a mortgage payment every month, I have a few tips to help you make money when you pay your mortgage! What? Make money on your mortgage? Yes! Totally possible!
Every month I think about the hefty payment I send to the bank because let's face it, there are better things I could do with that money but then again I think, I do need housing so I better make this payment! But in true-to-myself fashion, I've come up with a few ways to make that payment pay off for me.
Let's take a look at a few options that can help you make money by paying your mortgage:
Pay your mortgage with a rewards credit card
If you have a rewards credit card that allows you to pay your mortgage with it then take advantage of the cash back option as well as other rewards associated with the card. Many rewards cards allow you to receive cash back based on the type of purchase and your mortgage qualifies for such a reward.
Read the fine print. Make sure that you set aside the money necessary to cover the payment on your card. The only caveat -- if you're not the type to pay off the balance every month before the grace period ends then this strategy isn't for you. You must pay the balance before the end of the month to avoid incurring interest charges.
Rent rooms via Air BnB or Craigslist
This one is pretty straight forward. Rent out your room monthly or daily and use Air BnB or Craigslist to do so. If you're able to rent out rooms in your house to cover the mortgage or make a profit, then you're in the clear! You're free to dump that money into investments or leverage the profit made in other ways. How could you use an extra $500 or even freeing up a whole mortgage payment because it's been covered by your renter?
Prepay your mortgage
This method saves you a serious amount of cash over the long haul so if you have a mortgage and $50 extra to spare? Get on it! Here's the example by ABCNews.com:
Let me illustrate this with an example. Let's say you have a $200,000 mortgage. It's a 30-year fixed at 7 percent. Your monthly payment is $1,331. By sending in just $50 extra per month over the course of your 30-year mortgage you will save $36, 427.
When you pay your monthly mortgage, send in extra money and specify that it is to go toward reducing your loan amount -- the principal. The bank bases its interest charges on that principal, so by reducing the amount of principal, there is less for it to charge you interest on.
Can you stand to make extra money when you pay your mortgage? Do you have any ideas not listed here? Tell us in the comments section!