Avenue Mortgage, LLC

NMLS #1115220

  • Home
  • About
    • About Kay
    • Accessibility Statement
    • Texas Complaint Notice
  • Blog
  • Our Resources
    • First Time Seller Tips
    • First Time Buyer Tips
    • Home Appraisal
    • Home Inspection
    • Loan Checklist
    • Loan Process
    • Loan Programs
    • Mortgage Glossary
    • Mortgage FAQ
    • What to Expect at a Loan Closing: A Step-by-Step Guide
  • Our Reviews
  • Contact Us

Deciding Whether to Pay Extra Toward Principal or Save for Other Investments

September 18, 2025 by Kay Monigold

When it comes to managing your mortgage, one of the most common questions is whether to put extra money toward paying down the loan principal or to save that money for other investments. Both choices have advantages, and the right decision often depends on your goals, financial situation, and comfort with risk.

The Case for Paying Extra Toward Principal

Making additional payments directly to your mortgage principal reduces the amount of interest you pay over the life of the loan. Even small extra payments can shorten your mortgage term and save thousands of dollars on interest. For many homeowners, this approach provides peace of mind and a guaranteed return, since reducing debt always improves financial security.

The Benefit of Saving for Other Investments

On the other hand, investing outside of your mortgage may allow your money to grow at a higher rate than your mortgage interest. Retirement accounts, stock market investments, or even building an emergency fund can offer greater flexibility and potential for long term wealth. For borrowers with low interest rates, the opportunity cost of tying up money in the mortgage may outweigh the guaranteed savings.

Balancing Both Approaches

For many families, the best option is not an either-or choice but a balance. Contributing some extra funds toward the mortgage while still investing in retirement accounts or savings goals can provide both security and growth. This blended approach allows you to reduce debt while also building wealth for the future.

Deciding between paying extra toward your mortgage or saving for investments comes down to priorities. If you value financial certainty and want to become debt free sooner, paying extra toward the principal may be best. If you are focused on long term growth and maximizing returns, investing may be the smarter move. In many cases, combining the two strategies can give you the best of both worlds.

Filed Under: Mortgage Tagged With: Mortgage Education, Mortgage Tips, Wealth Building

Understanding the Federal Housing Administration Title I Home Improvement Loan Program

July 2, 2025 by Kay Monigold

Introduction to the Program
The Federal Housing Administration Title I Home Improvement Loan Program is a government-backed initiative designed to help homeowners finance necessary repairs, upgrades, and improvements to their primary residence. Established under the National Housing Act, this program makes funding accessible for individuals who may not qualify for traditional home equity loans due to limited equity or lower credit scores.

Purpose and Scope of the Loan
This loan program was created to support the maintenance and improvement of existing housing, thereby preserving the nation’s housing stock and enhancing community stability. The funds can be used for a wide range of home improvement projects that improve livability, utility, or safety. These improvements can include roofing, plumbing, structural repairs, heating and cooling systems, accessibility modifications, and more.

Who Is Eligible to Apply
To qualify for the Federal Housing Administration Title I loan, applicants must be the owner of the property and occupy it as their primary residence. In some cases, tenants may also qualify with the property owner’s approval. There is no minimum home equity requirement, which makes this loan especially helpful for newer homeowners or those living in areas with modest property values.

Loan Terms and Limits
The Federal Housing Administration Title I loan is available for both single-family and multifamily properties. For single-family homes, the maximum loan amount is typically thirty-five thousand dollars, with repayment terms extending up to twenty years.

Interest rates are set by the individual lenders and are generally based on the current market. These loans are unsecured; this feature reduces risk for the homeowner and simplifies the application process.

Permitted Uses of Funds
Loan proceeds must be used for permanent improvements that enhance the use or value of the property. Common eligible uses include:

  • Roof repair or replacement
  • Window and door replacement
  • Plumbing and electrical system updates
  • Heating and air conditioning installation
  • Accessibility enhancements for individuals with disabilities
  • Kitchen and bathroom remodeling
  • Energy efficiency improvements

Benefits of the Program
The Federal Housing Administration Title I Home Improvement Loan Program offers several key benefits to borrowers:

  • Accessibility for homeowners with limited equity
  • Flexible use for a broad range of essential home improvements
  • Long repayment terms that help manage monthly payments
  • No need for a home appraisal or significant documentation in many cases
  • Government insurance reduces risk for lenders, increasing borrower eligibility

These features make the program an attractive option for homeowners who need to make critical updates without taking on a second mortgage or drawing from existing equity.

How to Apply
To apply, homeowners should first contact a lender that is approved to offer Federal Housing Administration Title I loans. The lender will review the borrower’s financial situation, discuss the scope of the improvement project, and guide the borrower through the documentation and underwriting process.

A Practical Option for Necessary Home Upgrades
The Federal Housing Administration Title I Home Improvement Loan Program provides a practical, accessible financing option for homeowners who need to invest in the safety, efficiency, and longevity of their property.

For homeowners who need to repair, upgrade, or improve their home without significant equity or savings, this program may serve as a responsible and effective solution.

Filed Under: Mortgage Tagged With: Home Improvement Loan, Mortgage Education, Title I Program

Next Page »

Our Team

Kay MonigoldKay Monigold
Owner/Mortgage Broker/Residential Mortgage Loan Originator
NMLS#1086176

Steven LoweSteven P Lowe, Sr
Residential Mortgage Loan Originator
NMLS #1085638

GET A RATE QUOTE →

Connect with Us!

Browse Articles by Category

Accessibility Statement

We are committed to ensuring that its website is accessible to people with disabilities. All the pages on our website will meet W3C WAI’s Web Content Accessibility Guidelines 2.0, Level A conformance. Website Accessibility Policy

Equal Housing Lender


100 Independence Place, Ste. 308
Tyler, TX 75703
nmlsconsumeraccess.org

Quick Links

  • About
    • About Us
    • Texas Complaint Notice
  • Get a Rate Quote
  • Resources
    • Loan Process
  • Contact Us

Copyright © 2025 · Powered by MySMARTblog

Copyright © 2025 · Genesis Sample Theme on Genesis Framework · WordPress · Log in