It is true that a biweekly mortgage pays a lot better than a conventional one?
It a sort of is. The main distinction between the two is the number of period payments made within each mortgage year. You may have a conventional mortgage with a period payment due twice a month, which is very close to, but not exactly every other week. With a conventional mortgage you make 12 (months)* 2 (payments a month) = 24 payments a year. If you pay every other week instead, you will make 52 (weeks in a year)/2 = 26 payments, which means that without too much effort you can pay your mortgage off sooner. In fact, a biweekly mortgage based on a 7% 30 year conventional Fixed Rate Mortgage plan pays off in 23 years 11 months.
However, a biweekly mortgage is not always the best option. Alternatively, you can achieve the same result with a conventional mortgage and some extra payments, if your mortgage carries no prepayment penalties. The advantage of this system is that you are free to make the extra payments whenever you find it appropriate. With a biweekly plan you are obliged to pay every other week. It is pretty much a matter of discipline, which you may or may not lack in the mortgage payment business.
For more details read Biweekly Mortgages.
