Let’s be honest: we’re all looking for a few ways to save a little money on our mortgage payment. It’s most likely the largest chunk of money that leaves your bank account every month, so it’s perfectly natural to want to alleviate that financial thorn in your side. The good news is your mortgage payment is never really set in stone; it’s in a constant state of circumstances. By reevaluating your current situation every year or so, you’ll be able to keep your mortgage payments as low as possible.
1.) Update your information. Were you in a ton of debt when you applied for your loan? Maybe you were married to someone with horrible credit and you have since divorced. Whatever the circumstances may be, if they have improved you might want to look into refinancing to fit your current situation.
2.) Switch lenders. Not a lot of people like to read the fine print when it comes to their current lender, but that’s why so many of them are guilty of taking advantage of people. Don’t stay with a particular lender out of comfort, stay with them because they provide the best service and financial benefit to you, your family and your business. If another lender can better suit your needs, by all means look into it.
3.) Consider HARP for an underwater mortgage. If your mortgage is owned or guaranteed by Freddie Mac or Fannie Mae, you might qualify for the Home Affordable Refinance Program. As long as your payments are up-to-date and the value of your mortgage is more than 80 percent of the current value of your home, you might be in luck. If you match these circumstances you might want to look into this program.
4.) Consider other programs. HARP isn’t the only program out there. If you aren’t an underwater homeowner and have an up-to-date Federal Housing Administration (FHA) insured mortgage you may qualify for a Streamline Refinance. A Streamline Refinance basically takes your mortgage insurance premium back to whatever initial rate it started at, even if it has risen in the years past.
5.) Switch to a shorter-term loan. This sounds crazy; you thought we were trying to lower your mortgage payment, right? Well this is more the long term route. If you’re sitting in a good financial situation, paying an extra hundred dollars or so will save you tens of thousands in the long run. Plus, let’s not forget that your loan gets paid off in a much shorter time frame, improving your credit and putting your mind at ease.