Once you get your mortgage approved and move into your new home, it’s natural to not want to think of your loan again for a bit. But, your mortgage payments are probably your biggest recurring monthly expense. Given this, it’s smart to contact your lender at least occasionally to find out if there’s any way you can save more money on your mortgage payments. Here are some questions you may want to ask your lender when you call them:
Can your interest rate be lowered?
If you’ve been paying your mortgage for 5 years or longer and if your financial situation has improved over the years, there’s a chance you may be eligible to get a lower interest rate on your loan, thus reducing your monthly loan payment.
Can you refinance to a fixed-interest mortgage loan?
If you opted for an adjustable-rate mortgage, you may want to consider refinancing to a fixed-rate mortgage, especially if you are currently paying a high-interest rate.
Can you move to a shorter loan?
Most people opt for a 30-year term when getting a mortgage. But, if your income has risen over the last few years, you may be able to afford a higher monthly payment. This could, in turn, mean that you may be able to save money by refinancing to a shorter loan. Just remember to check your budget to know whether you can afford to make the increased payment.
Can you pay a little extra toward the loan?
Refinancing your loan may come with some charges and additional paperwork. If you want to avoid this, you can consider paying a little with each monthly installment so you reduce the principal over time. Doing this will shorten the term of your loan and help you save money on your monthly payments over time.
Can you lower your monthly payment?
If your monthly payments are becoming a financial burden, you may want to check if the lender can lengthen the loan term or lower your interest to help you with your repayments.
If your current mortgage is not as competitive as the loan offers in the market today, you may be able to save a substantial amount of money by reviewing your mortgage at least once every year.