Most Mortgage lenders will allow a borrower to pay at least 15% in lump sum payments against their mortgage annually.  This is above and beyond their mortgage payment.  However most borrowers do not take advantage of this.  You hear the excuse that I do not have 15% to pay down against my mortgage.  You do not have to pay 15%.  15% is the maximum.  You could pay $100.00 (usually the minimum amount).  A good practice is to increase your mortgage payment rather than applying the lump sum payments, it is easier.  By increasing your mortgage payment the funds are automatically withdrawn.  The mortgage payment becomes a regular fixed cost.

For example a $300,000.00 mortgage at a fixed rate of 3.79% on a 5 year term over a 25 year amortization will cost the borrower $1544.10 per month with $53,000.00 going to interest and $39,000.00 going to principle (your actual mortgage) over a 5 year term.  If you increase your monthly mortgage payment by $150.00  you will reduce the interest cost by $1000.00 but the amount going to principle goes up to $50,000.00.  This method will chop 3 years of your mortgage.  Combine this method with an accelerated bi-weekly payment (pay every two weeks) and you have paid down your principle by $60,000.00 and chopped six years of your mortgage.  Interest savings over a six year period could be as high as $70,000.00.  Not bad.

Remember every cent extra you put against your mortgage goes directly to your mortgage principle so not only are you reducing your mortgage but you are also reducing the interest the lender charges you.  It all adds up.