No matter what it is, everyone wants to pay less for it. From groceries to your car, everybody’s looking for an edge. So why are there millions of homeowners paying too much every month on their mortgage? Rates are at the lowest they’ve been in a decade and home values are rising, making your home more valuable. It’s time to refinance. Here are three ways to save money on your mortgage payment every month.
Sure, this seems obvious, but there are literally millions of homeowners out there paying too much for their home and not looking at the options they have to refinance. If you refinance to a lower rate today, you start saving money. Period. You can try a cash out refinance to pay off your outstanding credit card debt and lower that payment as well. Both HARP and FHA offer refinance programs that will save you money today.
Stop Paying Mortgage Insurance
What’s mortgage insurance? Anyone who has a loan that didn’t require a 20% down payment is likely paying PMI, or private mortgage insurance. PMI is an insurance payment that you make to the bank to help guarantee your loan. Since you’re putting less into the down payment, it makes the lender nervous, and PMI soothes that.
Now, I don’t mean don’t pay it. It goes hand-in-hand with a refinance, because you’ll refinance to a conventional loan. A conventional loan requires 20% equity in a refinance, so you will need to be somewhat into your mortgage payments, but you can cut that PMI off of your mortgage payment.
Extend Your Loan
The shorter your loan, the more you pay. That’s a fact. Some people have had situations change since they bought their home, and may want to make a lower payment each month, but are comfortable with staying in their home longer. (You can work this the other way as well, shortening your commitment to save money on interest payments down the line, but we’re talking about saving today.) If you change from a 15 to a 30-year fixed loan, you can lower your payment each month significantly.
Call The Home Loan Expert, Ryan Kelley and take advantage of lower mortgage rates to buy your home or refinance and save money. Call us in St. Louis at (314) 781-9700, Chicago at (773) 770-4727, Indianapolis at (317) 550-1515 or Nashville at (615) 810-8555.
You can always apply online at www.thehomeloanexpert.com, and we’re also open on Saturdays to better serve you. Don’t forget to follow @TheHomeLoanEx on Twitter for breaking mortgage news and knowledge. Nobody gets lower rates on better loans than The Home Loan Expert, Ryan Kelley, why go anywhere else?