How to Lower Your Mortgage Payment
As a homeowner, paying off a mortgage can be a challenging task. It can become even more difficult if you’re struggling to make your monthly payments. However, there are ways to lower your mortgage payment and save money each month. In this article, Metropolitan Mortgage Corporation shares some tips on how to lower your mortgage payment in Kansas or Missouri.
1. Refinance Your Mortgage
One of the most effective ways to lower your mortgage payment is by refinancing your mortgage. Refinancing your mortgage involves taking out a new loan to pay off your existing loan. The new loan usually comes with a lower interest rate, which can significantly reduce your monthly payment.
To get the best refinance rates, it’s essential to shop around and compare offers from different lenders. You can also consult with a mortgage professional at Metropolitan Mortgage Corporation to help you navigate the refinancing process.
It’s important to note that refinancing your mortgage may come with closing costs and other fees. Be sure to factor in these costs before deciding whether refinancing is the right choice for you.
How Long Should It Take To Refinance My Home?
2. Increase Your Mortgage Payment Frequency
Another way to lower your mortgage payment is by increasing your payment frequency. Instead of making monthly payments, consider making biweekly payments. This method can help you pay off your mortgage faster and save you money on interest charges.
When you make biweekly payments, you end up making one extra payment per year. This extra payment goes directly towards your principal balance, which reduces your overall interest charges and shortens the term of your home loan.
3. Request a Mortgage Recast to Lower Your Mortgage Payment
If you have a substantial amount of cash available, you can request a mortgage recast. A mortgage recast involves making a lump sum payment towards your mortgage, which then reduces your monthly payment.
Unlike refinancing, a mortgage recast doesn’t involve taking out a new loan or changing your interest rate. It merely adjusts the remaining balance of your mortgage, which then lowers your monthly payment.
4. Remove Private Mortgage Insurance (PMI)
If you’re paying for private mortgage insurance (PMI), you may be able to remove it and lower your monthly payment. PMI is typically required if you have less than 20% equity in your home.
To remove PMI, you’ll need to contact your mortgage lender and request an appraisal to determine your home’s current value. If your home has increased in value, you may have enough equity to remove PMI.
5. Extend Your Mortgage Term
Extending your mortgage term is another option to consider if you’re struggling to make your monthly payments. By extending your mortgage term, you can reduce your monthly payment by spreading out the payments over a more extended period.
For example, if you have a 15-year mortgage and extend it to a 30-year mortgage, your monthly payment will be significantly reduced. However, this means you’ll end up paying more in interest charges over the life of the loan.
6. Consider a Loan Modification
If you’re struggling to make your monthly payments due to financial hardship, you may qualify for a loan modification. A loan modification involves changing the terms of your mortgage to make it more affordable for you.
Loan modifications can include changing your interest rate, extending your loan term, or reducing your principal balance. To qualify for a loan modification, you’ll need to contact your mortgage lender and provide documentation of your financial hardship.
Lower Your Mortgage Payment Conclusion
Lowering your mortgage payment can provide much-needed relief for homeowners struggling to make ends meet. Whether it’s refinancing, increasing your payment frequency, or removing PMI, there are several options to consider. Consult with a mortgage professional
at Metropolitan Mortgage Corporation to determine which option is right for you and your financial situation.
Remember, it’s essential to consider the long-term effects of any decision you make regarding your mortgage payment. While lowering your monthly payment may provide short-term relief, it may end up costing you more in the long run.
At Metropolitan Mortgage Corporation, we’re committed to helping our clients find the best mortgage solutions for their unique needs. Contact us today to learn more about how we can help you lower your mortgage payment and save money on your home loan.