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The difference between a bimonthly and biweekly mortgage
Sometimes people come to this site looking for information on a bimonthly mortgage payment plan. The bottom line is there really is no such thing as a bimonthly payment plan. The alternative to a monthly payment plan is a biweekly mortgage payment plan.
With this plan a person would make a payment every two weeks towards principal and interest on his mortgage. A bimonthly payment plan implies that the mortgagee would be paying twice monthly. With a biweekly plan a person does make more than one payment each month but in some months he or she will make three payments.
If there were a bimonthly payment plan, it would require 24 payments per year. A biweekly plan requires 26 payments each year, simply because there are 52 weeks in a year. With the biweekly plan, a person will pay down his principal sooner than he or she would with a regular monthly payment plan because he is, in fact, making extra principal payments.
With a bimonthly plan, no extra principal would be paid and so the mortgage would be paid no sooner, or at least not significantly sooner than it would be with the regular monthly payment plan.
Therefore, when people are looking for a bimonthly mortgage payment plan, we have to assume they are looking for a biweekly mortgage payment plan. It's just a matter of which terminology one prefers. The key thing to remember:
A biweekly payment plan requires extra principal payments; a true bimonthly plan doesn't make any changes to your monthly payment and saves you no money over the course of a loan.
A Biweekly mortage payment plan will save you money. The problem we have with it is that unscrupulous lenders charge for converting your mortgage to a Biweekly plan.
For your convenience we have included a
Biweekly Mortgage Calculator