Mortgages help thousands of people become homeowners each year. They enable people from different backgrounds and incomes to receive the keys to their dream homes.
There is no question they open doors and opportunities to those who previously could not afford a home. But, monthly repayment costs can be expensive. Market changes and interest rates affect how much you pay back each month and fluctuate accordingly.
Find ways you can decrease your mortgage costs below.
- Extend the Term of Your Mortgage: Mortgage payments are made over time. There is no set period for paying back your costs. Everyone is different. Some like to pay it off as soon as possible. Others do not.
It is estimated most American homeowners pay their mortgages off anywhere from fifteen- to thirty-years following purchase.
Spread the cost of your mortgage over a more extended period to lower the monthly expenses. Ensure the interest rates are fixed. This enables you to know the exact charges you will pay each month.
- Get Rid of Mortgage Insurance: Mortgage insurance contributes a sizeable charge to your monthly payments. Homeowners must pay this until they have adequate equity on their property. At this point, the lender no longer views them as a risk.
Compare what mortgage loan you have. Determine this as soon as possible to understand what mortgage insurance you are currently paying.
Recipients of an FHA loan after 2013 are likely to pay a mortgage insurance premium. Refinance your loan to swap to private mortgage insurance.
Private mortgage insurance (PMI) is paid until you hit 20% equity on your property. Ask your lender to remove the PMI when you reach this point.
Refinance your property as another means of eliminating mortgage PMI from your monthly expenditure. Use services provided by The Home Loan Expert to assist you in this process.
- Refinance Your Mortgage: Research the terms and conditions of your existing mortgage. Compare the charges you are currently paying against those you would pay when refinancing your property.
Monitor market changes. These impact the interest rates that you pay. Keep track of interest rates lower than your current one.
Contact your lender as and when you find rates have dropped to negotiate a refinance.
- Appeal Property Taxes: Lenders open escrow accounts at the point of close. Money is stored in this account each month to cover any costs associated with homeownership.
Keep track of your tax bill to ensure you are not overpaying. State and county boroughs assess the property tax you pay through analysis of the property and land.
Appeal to these governing bodies if you are paying more tax than you should be. Compare taxes you are paying against that of homes like your own. You need evidence to support and strengthen your claims.
A reduced property tax assessment will mean you are not paying as much monthly.