I received an inheritance and i was wondering how i can go about paying down my principal mortgage balance?

James,As far as I know, there's no reason why you couldn't just make a larger principal-only payment on your existing mortgage loan. However, if you do have a large amount sitting around, you may want to consider a refinance that puts that large amount down, which would in effect lower your mortgage payments and could allow you to reduce your current term. If that sounds like something you may be interested in, I'd be happy to help. I'm a Licensed Mortgage Lender here in Austin. Give me a call at (512) 669-5252 and I can answer any of the questions that you have.

Hello sir. Unless you secured an "Alternative" loan with pre-payment penalties, you should be able to pay off as much as you want. Most loans allow for pre-payment, but most loans do NOT re-amortize and adjust the payment when you make a principal reduction.It's possible a refinacne could make sense, but only if you plan to be in the house for a while longer, and intend to have the mortgage for a while as well.I'd be happy to help you run some numbers and see if a refinance would be beneficial.Please send me just a few items of data and I can help run numbers....amount currently owedapproximate value of the houseamount you intend to pay as a principal reductionyour current interest ratehow long you intend to own this houseAnd...most importantly...your reason for paying down the note. Are you looking to lower your payment, or just pay it off quicker?I can be reached at joel@mortgageswj.com or at 214-295-2928.I would be happy to help in any way I can.Thanks!Joel Dyke

First, congratulations but also condolences. The first question is to make sure that there is no prepayment penanalty on your mortgage. If it was closed in the past few years it is unlikely but still worth contacting the company where you make your payments to confirm, and also ask them the best way to pay the balance down. Depending on the type of loan it may also be possible for them to re-amortize (or re-cast) the loan so that the new balance is spread out over the remaining life of the the loan - which means the required payment would drop. There is often a fee involved to do this, maybe $100-150 depending on the company.

You could but why??? there's an old saying.. "cash is king".. todays' interest rates are in the high 3's to low 4's.. so throwing a bunch of money to lower your principal will effectively only save you the rate of interest your paying on the mortgage.. yet, that equity is not protected, and would be difficult to get to if you ever had an emergency.. If you pay down your mortgage, and you lose your job, or get sick and cannot work, you would potentially lose your home if you cannot make your payments, regardless of how much equity you have.. and if you wanted to do a major purchase and you need the cash to do it, you would have to go the bank and apply for a loan to be able to tap into that money you paid your mortgage down with.. Talk to a financial planner, but I'm sure he would advise you to throw that money into an investment which should return you a higher percentage than your paying in interest on your mortgage.. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. 480-287-5714 WilliamAcres.com

If you can qualify at a lower rate, a refinance may be best. Almost all mortgages written after 2008 do not have a "prepayment penalty". Older "sub-prime" loans had a prepayment penalty up to 3 years, which long ago have expired.