My Mortgage company sent their annual bi-weekly payment letter to us this week.
Dear Frugal Momma and Not as frugal Dad,
XYZ mortgage has a great deal for you! We know that you are interested in saving interest on your mortgage. We hope that you are the fool that signs up for this!
We can save you tens of thousands of dollars in interest if you sign up for the bi-weekly mortgage payment. Instead of paying $1000 each month, you will pay $500 every other week. Just a little math trick for you to pay more, and that trick is to divide your mortgage in half and make that result the biweekly payment. 26 half-payments equal 13 whole-payments or an extra month's payment each year. Obviously, if you pay more money, you reduce your mortgage faster.
For this privilege of paying off your mortgage faster, we are going to charge you a one time fee of $500 and then monthly fee of $9.00. Just think of how much faster you will be paying off your mortgage even though we will be charging you a few thousand extra. If you were really thinking about paying your mortgage faster, you could split up a monthly mortgage payment by 12 and add that each month to your principal. However we really do not want you to do that because that would mean XYZ woudln't make as much money off your mortgage.
XYZ Mortgage values your business and we hope that you will consider taking this option so we can make some more money off of you.
Sincerely
I'm getting paid a commission to sell you this
XYZ
PS Even though you only got 19 years left on your mortgage how about refinancning to a 30 yr fixed. You would take $200 off of your monthly mortgage payment and end up paying $50,000 more in interest! I promise you it is a great deal.
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