Relay-Version: version B 2.10 5/3/83; site utzoo.UUCP Posting-Version: version B 2.10.3 4.3bsd-beta 6/6/85; site ucbvax.BERKELEY.EDU Path: utzoo!watmath!clyde!burl!ulysses!ucbvax!ucbcory!cc-06 From: cc-06@ucbcory.BERKELEY.EDU (Ilya Goldberg) Newsgroups: net.consumers Subject: Re: Semi-monthly mortgage repayments Message-ID: <10961@ucbvax.BERKELEY.EDU> Date: Tue, 12-Nov-85 20:52:16 EST Article-I.D.: ucbvax.10961 Posted: Tue Nov 12 20:52:16 1985 Date-Received: Thu, 14-Nov-85 01:10:20 EST References: <1389@decwrl.UUCP> Sender: usenet@ucbvax.BERKELEY.EDU Reply-To: cc-06@ucbcory.UUCP (Ilya Goldberg) Distribution: na Organization: University of California, Berkeley Lines: 19 In article <1389@decwrl.UUCP> marks@yogi.DEC writes: > >I have recently read about a new type of real estate mortgage agreement, >in which the bank gives the buyer a mortgage at the normal insterest >rate for, say, a 30-year, fixed-rate mortgage, but allows the mortgagor >to pay off the loan semi-monthly rather than once a month. The total >monthly payments are the same, they are just split in half and paid >twice a month. > >The incredible part of this is that you manage to reduce your interest >[...] and you pay off what would >have been a 30 year mortgage in something like 12 years. > 12 years seems a much smaller time period than 30 and is not very believable. Could someone post a formula either verifying '12 years' or giving the correct period of time based on the above pay off arrangement? Ilya (...!ucbvax!ilya)