Tips for Paying Less on Your Home Mortgage
The reason that people lend other people money is because the interest charges make such loans a good investment. And the home mortgage is quite lucrative. Lenders get back a great deal more than they allow you to borrow, as you pay interest charges every month, year after year. Well, here are some tips for paying less overall on your home mortgage:
- Make a bigger down payment. Try to make the biggest down payment you can afford. The more money you pay up front, the less you borrow. And since interest is expressed as a percentage of the total you borrow, the interest will be lower.
- Try to get a lower mortgage interest rate. Look for home mortgage loan programs that offer lower rates. This means a conventional loan is likely to be best. This lower interest rate should be applicable the entire term of the loan, and not just for a short introductory period at the front. A fixed rate is also preferable to a variable rate, as over time the fixed rate usually results in less money paid to the lender. You will need a good credit score to qualify for a lower mortgage interest rate.
- Get a shorter loan term. The longer you are paying interest, the more interest you will pay. You can reduce the amount you pay on your home mortgage by getting a shorter loan term. A 15 or 20 year home mortgage may have a higher monthly payment, but it results in paying less over the long term. And, quite often, a shorter loan term comes with a lower interest rate.
- Pay biweekly on your home mortgage. Instead of a monthly payment, consider a biweekly home mortgage payment. You make payments every other week, resulting in what amounts to one extra payment per year. This can reduce the amount of time you have your mortgage, and the interest charges you pay. Just watch out for prepayment penalties.
Tags: biweekly home mortgage, home mortgage blog, home mortgage, mortgage interest rate,
lower mortgage interest, mortgage lenders, home loan
October 29th, 2007 at 10:54 am
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October 30th, 2007 at 8:55 am
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October 31st, 2007 at 2:01 pm
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February 23rd, 2008 at 4:09 pm
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