What is the primary benefit of a bi-weekly mortgage payment plan?

The primary benefit of a bi-weekly mortgage payment plan is that it allows borrowers to make extra payments toward their loan balance, leading to a significant reduction in the total interest paid over the life of the loan. When borrowers make half of their monthly mortgage payment every two weeks, they end up making 26 half-payments each year, which equates to 13 full monthly payments instead of the standard 12. This additional payment directly reduces the principal balance, which can lead to lower interest costs over the term of the loan. Consequently, the overall length of the loan can be shortened, allowing borrowers to pay off their mortgage sooner.

The other options do not accurately reflect the primary benefit. Lower monthly payments do not typically arise from a bi-weekly plan; rather, the total amount paid might remain similar, but the accelerated schedule leads to different outcomes. Reduced property taxes are unrelated to payment frequency but are generally based on property values and local tax rates. Lastly, faster loan payoff through higher interest rates is misleading, as bi-weekly plans do not typically involve higher interest rates but rather leverage the frequency of payments to enhance repayment efficiency.