Save money on Your Mortgage | CM Fox Real Estate

Top 5 Ways to Save Money on Your Mortgage

For most homeowners, a mortgage is arguably the largest financial commitment they’ll make in a lifetime. However, you don’t have to break the bank to own your first home. There are many ways to save money on your mortgage that don’t require you to give up your favorite pastimes or only eat rice and beans.

Here are some of the top ways to save money on your mortgage.

Put Down a Larger Down Payment

You’ll pay more interest over the long term when you put less money down. Paying a larger down payment can reduce your monthly payments. If you’re paying a higher interest rate, you can reduce your rate by increasing your down payment. When you put 20% down, you don’t have to pay private mortgage insurance (PMI).

Shop Around

When shopping for a mortgage, compare rates and annual percentage rates between different lenders. Then, stick with a company that has favorable interest rates. You could also save some money by shopping for your mortgage through specific government programs, such as FHA loans for first-time homebuyers.

Pay Off Your Mortgage Earlier

If you can pay off your mortgage earlier, it will save you money. This is because interest compounds over time, so it will take longer to pay it off if you have a larger loan. Long story short, paying off your mortgage early can save you thousands of dollars!

Lock in a Fixed Rate

You can lock in your interest rate by getting a fixed-rate loan. A fixed-rate mortgage will have the same interest rate over the life of the loan. So if you plan to stay in your home for a long time, consider locking in a fixed rate for the rest of your mortgage.

Refinance Your Mortgage

If your interest rate is less than affordable, you could consider refinancing your mortgage. Refinancing your home loan will allow you to lower your payments. You can also refinance into a new loan with more agreeable terms, such as 15 or 20 years, instead of the typical 30-year plan. The longer you have your mortgage, the more money you’ll pay. Consider getting a shorter term, so you pay less interest over time and have fewer payments to make each month. Similar to our other tips, this could save you thousands of dollars over the lifetime of a loan.

Get Advice From a Realtor

Saving money on your mortgage can help you pay it off sooner. So take advantage of the opportunities to reduce your mortgage and save thousands of dollars. Consult a realtor at CM Fox Real Estate, who can help plan your residential real estate needs. Contact us through our website or call 518-861-7030 to set up a consultation.