Choosing the right mortgage payment schedule can have a significant impact on your long-term financial planning. One option that is gaining popularity among homeowners is the biweekly payment method. For customers of Lakeview Mortgage, making biweekly payments may offer several benefits, such as reducing the overall interest paid and shortening the loan term. Understanding how the Lakeview Mortgage biweekly payments work, their advantages, and how to set them up is essential for borrowers who want to take more control over their mortgage payoff strategy.
Understanding Biweekly Mortgage Payments
What Are Biweekly Payments?
Biweekly mortgage payments mean making a half-payment every two weeks instead of one full monthly payment. Since there are 52 weeks in a year, this results in 26 half-payments or 13 full monthly payments annually one extra payment compared to the standard monthly schedule. This small change can significantly impact how quickly the loan is paid off and how much interest is saved over the life of the mortgage.
How It Differs from Monthly Payments
With monthly payments, borrowers make 12 payments a year. In contrast, biweekly payments introduce an extra payment each year without a large upfront cost. This accelerates the mortgage payoff process and reduces the total interest paid to the lender. For a 30-year mortgage, using a biweekly payment method could reduce the term by several years.
Lakeview Mortgage and Payment Options
Lakeview Loan Servicing Overview
Lakeview Loan Servicing is a prominent mortgage loan servicer in the United States, managing millions of loans across the country. They provide a variety of options for making payments, including standard monthly plans and more accelerated options like biweekly payments.
Availability of Biweekly Payments
Lakeview Mortgage customers may have the option to enroll in a biweekly payment plan through third-party services or directly through Lakeview, depending on the specifics of their loan. Borrowers are encouraged to contact Lakeview’s customer service to confirm whether biweekly scheduling is available and what fees or rules may apply.
Benefits of Biweekly Payments
- Faster Loan Payoff: By making 13 full payments a year, borrowers can pay off a 30-year mortgage in approximately 2526 years, depending on the interest rate and loan amount.
- Interest Savings: Making payments more frequently reduces the average daily principal balance, which means less interest accrues over time.
- Budgeting Convenience: Biweekly payments may align better with how people receive income (e.g., every two weeks), making it easier to manage finances and avoid missed payments.
- Improved Equity: Faster principal reduction helps homeowners build equity more quickly, which can be beneficial for refinancing or selling the home.
Things to Consider Before Starting
Confirming Program Eligibility
Before setting up biweekly payments, it’s important to verify if Lakeview Mortgage supports this structure directly. Some mortgage servicers do not allow biweekly plans unless the borrower uses a third-party payment processor. In some cases, the lender may not apply the extra payment toward the principal immediately, which could reduce the effectiveness of the strategy.
Potential Fees
Some biweekly payment services charge administrative fees. Borrowers should evaluate whether the cost of the service is justified by the potential savings. It’s important to ask whether Lakeview Mortgage charges any enrollment or processing fees for switching to a biweekly plan.
Extra Payments Must Go Toward Principal
For biweekly payments to be effective, the extra payment must be applied to the loan principal. If it’s treated as a future interest payment or simply held in escrow, the financial benefit is lost. Borrowers should request confirmation in writing that their extra payments will be applied to reduce the principal balance.
Setting Up Biweekly Payments with Lakeview Mortgage
Steps to Begin
- Log into the Lakeview Mortgage customer portal and review payment options.
- Call customer service to inquire about biweekly payment availability and ask for detailed instructions.
- Determine whether the payments can be scheduled directly through Lakeview or require a third-party service.
- Set up automatic payments if possible to ensure consistency and avoid missed due dates.
Using a Third-Party Biweekly Payment Service
If Lakeview does not directly offer biweekly plans, borrowers can use third-party services. These services draft payments from your account every two weeks and remit full monthly payments to Lakeview. The 13th payment is then sent separately and applied to the principal. Ensure that the third-party provider is reputable and compliant with financial regulations.
Calculating the Impact of Biweekly Payments
Example Calculation
Let’s consider a 30-year fixed-rate mortgage of $250,000 at 5% interest. A monthly payment would be approximately $1,342. If the borrower switches to biweekly payments of $671 (half of the monthly payment):
- Total annual payments: 26 x $671 = $17,446 (vs. $16,104 under monthly plan)
- Extra payment: $1,342 annually toward principal
- Loan term reduction: Approximately 45 years
- Interest savings: Potentially over $30,000 over the life of the loan
Using Online Calculators
To get a more accurate estimate based on your unique mortgage details, use a biweekly mortgage calculator. Input your current balance, interest rate, and loan term to see how much faster you could pay off your loan and how much interest you could save.
Frequently Asked Questions
Can I make extra payments without switching to biweekly?
Yes. Borrowers can make additional principal payments manually each month or annually. Even occasional extra payments can help reduce interest and shorten the loan term. Just ensure the payment is clearly marked as a principal-only payment.
Is there a penalty for early payoff with Lakeview?
Most residential mortgage loans serviced by Lakeview do not have prepayment penalties, but this should be confirmed by reviewing your loan documents or contacting customer service.
Can biweekly payments hurt my credit?
On the contrary, consistent on-time payments can improve your credit score. Automated biweekly payments may help ensure that you never miss a due date, supporting a strong credit profile.
Lakeview Mortgage biweekly payments present a practical and effective way to save money on interest and pay off your loan faster. By understanding how biweekly payments work and how to implement them properly, homeowners can take an active role in reducing debt and building equity. It is essential to verify program eligibility, confirm that extra payments go toward the principal, and consider any fees involved. With careful planning and consistent execution, switching to a biweekly payment schedule can be a smart financial move for many borrowers under Lakeview Loan Servicing.