If you are like most homeowners in today’s world, chances are your mortgage payment takes up a large portion of your overall monthly income. In today’s economy, every penny definitely counts, especially for those who are earning less income due to cut hours or job loss. The good news is that there are ways to save on your monthly mortgage payment as well as lower your overall expenses for the month, it just takes a little bit of reconfiguring on your part. Here are some strategies that can help you save money each month, as well as allow you to put a little aside for future use.
Make a Sizable Mortgage Payment
Since the mortgage payment is most likely your highest monthly expense, the sooner you can pay this off, the more financial freedom you will have. By making a lump sum payment towards your mortgage, you will not only move the process along, you may also be able to lower your monthly mortgage payments until 2014. These monthly savings can be put toward additional debt, or they can simply be moved into a high interest savings account, allowing for a nice savings cushion.
Carefully Consider Bi-Weekly Payments
Making bi-weekly mortgage payments is becoming an increasingly popular practice among homeowners, simply due to the fact that it allows homeowners to save money by paying off their mortgages faster. The catch, however, is that there is often an upfront fee that lenders charge in order to allow this type of payment option, which in many cases, can defeat the purpose.
Research Your Rate Options
If you are looking to lower your overall mortgage rates, you can consult with your current lender regarding refinancing, and you may be interested in shopping around with different lenders in order to find a loan that is a more suitable fit. It is important to note however, that lowering your rates may generate a new set of fees that in turn could end up minimizing your overall savings.
Extend Your Loan
While many homeowners are looking to pay their mortgages off early, the alternative is actually to extend the life of your home loan. This will definitely lower your overall monthly payments, allowing you to take care of additional debt and put aside a little savings each month. By refinancing and extending the life of your loan, you can potentially lower your payments for an entire year, allowing for substantial savings. Additionally, if you change your mind later on down the line, you can start making larger payments each month in order to pay down your mortgage at a faster pace.
The Home Affordable Modification Program allows qualified homeowners loan modification due to financial hardship. If your income has changed due to the economy, your lender may be able to assist you in modifying your loan payments if you meet specific criteria. This will definitely help you save each month, as well as help you put some money towards any additional debt you may have.
In today’s economy, many homeowners are looking for ways to save money wherever they can, and while certain regulations regarding home loans have been tightened, there are varieties of options for borrowers that are looking to lower their payments. By consulting with your lender and learning what options are available to you, you should be able to find a common middle ground that will satisfy the lender while at the same time allowing you to save money each month, allowing for a secure financial future.