How to Lower Your Monthly Mortgage Payment

How to Lower Your Monthly Mortgage Payment

We cannot deny how hard it is to earn money. This means that we need to cut some of our expenses. One of the biggest parts that bite your credit card is your mortgage payment. With that in mind, it would be a good idea to use it as the starting point to cut down your expenses.

You have lots of responsibilities. You need to save money for future emergencies. With that in mind, you might be looking for some effective ways on how to lower down your monthly mortgage payment. Well, you are in the right place. In this post, we are going to provide you with some of the effective options you may try to cut down your monthly mortgage expenses. So, if you want to know more about it, then keep on reading and learn.

For overseas mortgages, things are a bit different, as explained here.

Lower Rate Refinancing

One of the best ways to reduce your monthly mortgage payment is to refinance your property to a much lower interest rate. 

If you are planning to refinance your property, it is important that you have the right home equity. Aside from other needed requirements, you also need to have adequate home equity. Home equity refers to your property’s market value after reducing your unpaid mortgage. Aside from that, you are also required to make a payment for your refinance closing costs.

Longer-Term Refinancing

One of the reasons behind the popularity of home refinancing is that you can take advantage of the more time allotted to pay your mortgage. For instance, if your mortgage should be paid within 30 years and you paid half within 15 years, you can pay the remaining half for additional 30 years. This means that your monthly mortgage payment will be reduced. 

On the other hand, considering the length of your payment, you should expect an increase in the interest rates. This is true if you are paying your monthly mortgage in a long span of time. So, if you are planning to cut down your monthly mortgages, it is important to weigh its pros and cons.

Be Part of the Loan Modification

If you have a hard time managing your money and you don’t think you can pay your mortgage on time, then one of the best options you may consider is to apply for a loan modification. This is the time when your lender will create some changes regarding your loan to somehow lessen your mortgage’s monthly payment.

Loan modification does not only welcome those borrowers who find it hard to pay their monthly mortgage. They also cater to individuals who are experiencing a hard time regarding their income reduction. So, if you are preparing for your retirement or you lost your job, you can apply for a loan modification.

Throw Away Your Mortgage Insurance

Mortgage insurance is an additional cost that needs to be shouldered by anyone who makes a conventional loan or FHA loan. If you are going to throw away your mortgage insurance premium, you will notice a decrease in your monthly mortgage payment.

Eliminating your mortgage insurance is easy. You just need to apply for a conventional loan refinancing. Your PMI or Private Mortgage Insurance is a requirement if the down payment you make for a conventional loan is not more than 20 percent. You can cancel it by talking to your lender and showing the evidence and documents that prove that you have ample home equity. Aside from that, refinancing is also another way to eliminate your private mortgage insurance.

Be Part of Mortgage Forbearance

Aside from applying for a loan modification, another option you may consider is applying for a mortgage forbearance. This is applicable if you are looking for a short-term solution to your problem, which is you don’t have enough money to pay your monthly mortgage on time. 

If you are experiencing a financial hardship, which you think can last for a couple of weeks or months only, then besides loan modification, you can apply for mortgage forbearance.

When you apply for mortgage forbearance, you and your lender may create an agreement regarding the suspension or lowering of your mortgage payment in just a short period of time. After the forbearance period ends, your monthly payment will be back to normal. 

If you are planning to apply for a mortgage forbearance, you need to talk to your lender a few weeks before you miss your monthly mortgage payment.


There are a lot of ways you can do to lower down your monthly mortgage payments if you are planning to refinance your home. Aside from that, several ways are also available if you want to cut down your monthly mortgage payment if you already purchased a property. No matter what your case is, take note that lowering your monthly mortgage will extend the time you need to repay it while increasing the interest rates.

Take note that all the solutions we presented above are not a one-size-fits-all answer. Each of the solutions has its pros and cons. So, it is important to weigh its advantages and disadvantages before taking the path. 

Doing one of the answers can result in an increase to the interest you are paying as years go on. But this might not be a huge problem for you if you are planning to refinance or sell your property in the future. Aside from that, even though you are required to pay more interest than before, the reduction to your monthly mortgage payment is still beneficial as it can help you to use your budget in paying more important businesses. To sum it up, considering the advantages and disadvantages of each solution presented and its possible effect to your entire financial situation is an important factor you need to take into consideration. We know that during these days, earning enough amount of money to sustain all your expenses is quite hard. So, one of the best ways to decrease your financial burden is to lower down your monthly mortgage payment.


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