Very few borrowers who choose a longer repayment term, intending to make extra payments, succeed in doing so. Paying extra each month requires discipline.
It is too tempting to spend the extra money instead of paying down the debt. Even if you start off paying extra on the loans, you will struggle to restart the higher loan payments after the first time you need the extra cash flow. Or, you’ll pay less than you were paying previously.
Making the higher loan payments mandatory provides a psychological benefit. If the loan payments are automatic, you’ll find a different way to deal with a shortfall in your monthly budget.
So, before you choose a longer repayment term, ask how likely you are to make the larger loan payments if they are optional?
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