What I do ...

I send a little bit extra to be applied to the principal to make it a round number.

Here is how to do the math:
Required payment: $1200 / month
Interest rate: 5%
Escrow amount: $250 / month
Loan balance this month: $105,000

Multiple the loan balance by the interest rate: $105,000 x .05 = $5250
Divide by 12 (12 months in the year. You only pay 1/12 of the annual interest): $437.50

So far your payment HAS to be $437.50 (interest) plus $250 (escrow) = $687.50

That means if you pay the required $1200, only $512.50 will be applied to your principal balance.

Instead, decide to have $525 or $550 applied to your principal balance. Your loan balance will then go from $105,000 to $104,450 (if you pay $550).

So add: $437.50 (interest) + $250 (escrow) + $550 (principal) = $1237.50 and this is the amount you'll send in as your payment.

On your payment slip there should be a space for indicating that you're paying extra toward your escrow or you're paying extra to your principal. You will put $37.50 in the space that says you're paying extra toward your principal ($1237.50 - $1200 = $37.50).

Next month when your statement comes in your new loan balance should be an even number. IF NOT, the bank did something wrong and you can ask them to correct it immediately.

This only works, of course, if you get a monthly statement and not a payment book. If all you have is a payment book then ask the lender to switch you over to a monthly statement. They'll balk but they have to do it - and they have to do it for FREE.

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"I've been rich and I've been poor but independently wealthy is where it is at."

Some lenders charge you to set up the bi-weekly plan. You can get the same effect by adding to your principal each month. Usually, you make 12 payments each year. When you pay bi-monthly, or every two weeks, you make 26 "half" payments, which turns out to be 13 whole payments. If you take one-twelfth of your payment and add that amount to principal each month, the result is basically the same.

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~Jeweled

Bi-monthly is not the same as bi-weekly. Bi-monthly is 24 payments a yearly and bi-weekly is 26 payments yearly. One of the reasons I was interested in the bi-monthly is because it is no more money out of your pocket, you are only paying 1/2 of your monthly payment early.