The calendar trick behind biweekly payments
Here's the clever part: a year has 52 weeks, not 48. Pay half your mortgage every two weeks and you make 26 half-payments, which adds up to 13 full payments a year instead of 12. You barely feel it, because each half-payment lines up with a biweekly paycheck, but that 13th payment goes straight to principal every single year.
Because principal is what interest is charged on, knocking it down early snowballs. On a typical 30-year mortgage, biweekly payments cut several years off the loan.
Do it yourself, skip the fee
Some companies charge a setup fee or a per-payment fee to run a biweekly plan for you. You don't need one. You can get almost exactly the same result by adding one-twelfth of your payment to each monthly payment and marking it “principal only.” The calculator shows that number for you.
Before switching, ask your servicer two questions: do they accept biweekly payments, and do they apply half-payments right away or hold them until the full payment arrives? Either way works, but it's good to know.
Is it right for you?
- Great fit: you're paid every two weeks, have an emergency fund, and want to own your home sooner without thinking about it.
- Think twice: you carry high-interest credit card debt. Paying that off first saves more.
- Also consider: if your rate is very low, investing the extra might grow faster, though with more risk.
Did you know?
If you're paid every two weeks, two months each year have three paydays. Those are the months the 13th mortgage payment quietly comes from.
Example
On a $300,000 mortgage at 6.5% for 30 years, the monthly payment is $1,896.20. Paying $948.10 every two weeks instead pays the loan off in 24 years 2 months, almost 6 years early, and saves about $88,123 in interest. Adding $158.02 to each monthly payment gets you to the same payoff date and saves about $87,259, with no program needed.
Frequently asked questions
Is a biweekly mortgage the same as paying twice a month?
No. Twice a month is 24 half-payments a year, which equals 12 full payments and saves almost nothing. Every two weeks is 26 half-payments, which adds the 13th payment.
Does biweekly lower my interest rate?
No. The rate stays the same. You save because the balance shrinks faster, so less interest builds up.
Can I stop biweekly payments later?
If you're doing it yourself, yes, any time. Third-party programs may have cancellation terms, so read them before signing up.