How to Lower Your Mortgage Payment and Save Money

Estimated reading time: 2 minutes

Your mortgage payment is paid monthly and is divided between paying your loan’s principal, interest, taxes, and insurance. There are numerous reasons to want to lower your payment, like increasing your savings, having extra cash for everyday expenses, or consolidating other debts. Today, we’re focusing on some of the most achievable ways to lower your mortgage payment.

Removing Mortgage Insurance

Mortgage insurance may be required, depending on your loan program, how much equity you have in your home, and the size of your down payment. This insurance is necessary to protect the lender from money losses if you are unable to make your monthly payments. Having to pay mortgage insurance every month can add a lot of cost over time. For more information about how to remove your mortgage insurance, contact your Loan Originator!

Utilize a Rate and Term Refinance

A lower interest rate can lead to big monthly savings! A refinance will also affect how much of your monthly payment will go toward your loan principal and can increase your cash flow.

Also, a fixed interest rate mortgage is often offered for 15-, 20-, or 30-year terms. These terms ensure your payment stays the same over the lifetime of your loan. By refinancing your current loan and extending the term to 30 years, you may be able to reduce your monthly payment. This can alleviate a higher monthly cost, although you may end up paying more interest in the long term.

Shop Around for Homeowners Insurance

Homeowners insurance protects your physical property, your belongings, and your liabilities. What your insurance protects and excludes depends on the policy. If you’re paying for your insurance as part of your monthly payment, shopping for a better rate may be beneficial. In addition, review your coverage to ensure you’re not overpaying for something you don’t need.

Property Taxes

Property taxes affect both your housing budget and mortgage payments. They vary per property, even in the same neighborhood. Property taxes are based on a tax assessment by your local government or county. If you believe you’re paying property taxes that are not in line with your home’s value, ask your Loan Originator about our free Property Tax Relief Solution.

Your Mortgage, Your Way

When you work with a mortgage lender like Homestead Funding, you’re setting yourself up for mortgage and homeownership success! Our Licensed Loan Originators are waiting to assist you in having the home financing that works best for your unique situation. When you’re ready to get started, contact us today!