5 Ways to Reduce Monthly Mortgage Payments

Are you struggling to survive with the little money paying a mortgage is leaving you to live on? Here are 5 ways to help you reduce your monthly payments.

Stop your Private Mortgage Insurance

Unlike the other types of mortgage insurance,  Private Mortgage Insurance (PMI) protects the lender, not you. Yet, If you put a deposit down of less than 20%, you’ll probably be currently paying PMI. The bank won’t stop your PMI until you request it; once you’ve repaid 20% of your mortgage, contact the bank to stop your PMI. They’ll probably send an appraiser to value the house and make sure that you own 20% of the house.

Don’t remain on a standard variable rate mortgage

Remaining on a standard variable rate (SVR) mortgage is  the most expensive mistake most house owners make. Once your introductory rate has expired, the bank will change your mortgage to a standard variable rate (SVR). SVR are high because they’re how banks make money from mortgages. The only way to avoid overpaying is to constantly review your mortgage.

Work on Increasing Your Credit Score

Your Credit Score affects the interest of your mortgage. Low credit scorers will get higher rates. Pay down your credit cards and remove late payments from your credit report by making a deal with the creditor or the credit bureaus.

Extend your loan

We only recommend extending your loan if you’re really struggling with your mortgage, as It will reduce your monthly payment but you’ll end up paying more interest.  

Overpay on your mortgage repayments whenever you can

It can seem redundant, but overpaying your mortgage will help to lower the interest and therefore your monthly payments. Before making any overpayments, check with your bank on potential penalties. Also, most banks have now an online mortgage overpayment calculator, check yours (just put Mortgage Overpayment Calculator followed by your bank’s brand name) to get a better idea on how much you can save.