How to Lower Your Mortgage After Living in Your House for a While
Lower Your Mortgage
Have you been living in your house for a while now and are considering buying another, downsizing, or wanting to lower the cost of your mortgage payments each month?
If so, then read on. This article will discuss several strategies that can help you lower your mortgage after living in your home for a while.
And if one strategy seems like it could not work for you, don’t give up!
There is no “one size fits all” approach when it comes to lowering your monthly costs.
Refinance
Refinance your loan and get a lower interest rate. This is the most obvious way of lowering monthly payments, but it could still be an option if you have poor credit scores or are unsure whether to refinance your current mortgage.
For more info, consult your bank. You can refinance your current mortgage into another type of loan (e.g., HELOC).
This is not always ideal because it will leave you with two loans at once, but if one loan has a much lower interest rate than the other, then it can save you money.
Lower Insurance Rates
Cut down on your insurance expenses. If you cut back on the amount of coverage, and pay for repairs out of pocket when something breaks, then it will lower your monthly payment.
Less Home Renovations
Spend less on home renovations. Making upgrades or repairs to your house can increase its value, but if you don’t plan on selling anytime soon, they probably aren’t worth the cost.
Make Extra Payments
Make extra payments on your loan each month, or pay off the entire balance ahead of time. This is an easy way to reduce your total amount owed quickly, and with any luck, you will see a lower interest rate and qualify for the next strategy.
Work With Your Bank
Negotiate with your bank or lender to get them to accept a different payment plan (e.g., biweekly payments).
If they agree, this can save you money on interest each month, but it might also require that you pay an administrative fee to set up the new payment system.
Downsize
Get rid of your current house and buy another more affordable one (e.g., smaller, older, etc.)
This will work best if you have enough money saved elsewhere or can find a home that you can buy for less than the amount of money left on your current house.
Remortgage
Remortgage with another lender who has better rates and terms (e.g., lower closing costs).
This is not always an option, but it might be worth looking into if you have good credit scores.
Lower Property Taxes
Lower your property taxes by appealing to your local government for reassessment.
This is usually best handled through an attorney or tax advisor and should not be taken casually as you could lose money by appealing.
If you feel like you’re living paycheck to paycheck because of your mortgage, look into ways for lowering it. There may be solutions that will work for you.
Category: Mortgage
