These three tips can lower your interest payments and save you money.
Did you know there are ways to lower your mortgage payment? I think we all know that we’re not going to see 3% mortgage rates again any time soon, but there are still ways to keep things affordable. Here are my three favorite strategies:
1. Buy points. This is a one-time payment with which you can lower your rate. For each quarter of a percentage reduction, you would pay 1% of the mortgage. We can sometimes work this into your mortgage amount or get the seller to pay for it. If you’re going to live in your house for at least four years, this will be financially worth it.
2. Get in an extra mortgage payment. If there is any way that you can sneak in extra mortgage payments during a year, you can save a lot of money in the long run. You can do this by paying for your mortgage every four weeks instead of every month, or even by making an extra payment when you get a bonus. On a $475,000 mortgage, this method could save you $156,000 over the life of your loan and reduce the length by six years.
3. Stop paying for private mortgage insurance. This is my favorite method because it doesn’t cost anything. If you have over 20% equity in your home, you can cut private mortgage insurance from your monthly payments, and this can add up. Talk to a lender about getting an appraisal to see if this is possible for you.
This can get complicated, so if you’d like to talk about your situation or have any questions, don’t hesitate to reach out. You can call or email me anytime, and I would be happy to hear from you.
