If you make all your payments, you are guaranteed to pay mortgage early in full at the end of the term. In the early years, most of each payment will be interest and the majority of the capital will be paid off during the later years of the mortgage term. Your monthly payment covers both interest on the outstanding loan and a repayment of capital. With this repayment mortgage it's a good idea to take out separate life assurance and critical illness cover to ensure that your mortgage is paid off and there's financial protection in the event of critical illness or deaths.. This is the most common method of pay mortgage early.

The reasons for doing it are as much emotional as they are financial. Peace of mind is one of the most significant benefits of pay mortgage early. On occasion, perhaps through a windfall or through prudent, long-term savings, couples have an opportunity to pay mortgage early. While there is usually no tax benefit in paying off the mortgage early, paying off the mortgage is one of the most desirable ways to use extra funds. The biggest financial advantage is that you end up with a guaranteed, risk-free return, because you no longer have to pay out the amount of money you've been paying in interest..