At Lending Bankers Mortgage, our goal is not only to help you choose a home loan that fits your needs, but also to guide you throughout your mortgage journey. That means offering you tips to help you be proactive in how you manage your mortgage payments. A lot of homeowners do not do this, and miss out on benefits such as:
- Paying your mortgage off more quickly.
- Saving money on your home loan.
- Managing your overall finances more effectively and affordably.
To help you realize these benefits, here are some tips for how you can get more proactive with managing your mortgage.
Tips When Managing Your Mortgage
- Start by choosing the right mortgage. You can be proactive in how you handle your home loan before you even sign on it. How? Simply by doing the research necessary to choose the product that will help you maximize your return on investment.During your consultation, we can introduce you to a range of mortgage products, explaining how each could impact your finances. That way, you can choose an ideal home loan.
- Put mortgage payments on auto pay. The next helpful thing you can do to manage your mortgage payments in a proactive way is to select automatic payments. Missing even a single mortgage payment can be disruptive to your life. Plus, you will lose money through late fees. But with automated payments, you will never need to worry about late fees.
- Switch to a bi-weekly payment schedule. Do you pay on your mortgage once a month, or plan to do it that way? Here is an idea—try a bi-weekly payment schedule instead. Submit half of what you owe in the middle of the month, and half at the end, and continue that way indefinitely. When you pay this way, you will feel like you are paying the same amount you would be with regular monthly payments. But over the course of a year, you will end up making the equivalent of 13 monthly payments instead of 12. As a result, you will have submitted one extra mortgage payment that year, but you will hardly have had to think of it. If you do this every year, it will add up, helping you to finish paying off your home loan sooner. Should you just make regular monthly payments instead, and then one extra payment per year? If you find this simpler, sure. But for a lot of people, it is psychologically easier to use the bi-weekly payment schedule, since you will not be parting with the extra payment all at once. It could be financially easier too. Plus, depending on your lender, an enrollment fee may be a requirement of switching to paying every two weeks on your mortgage. If that is the situation, it may be worthwhile to just make one extra lump sum payment each year, and/or pay a smaller amount extra each month with your regular monthly amount.
- Consolidate high interest debts. Do you have high interest debts eating away at your finances? The more money you pour into the interest on those debts, the less you will have available for paying off your mortgage. Instead of passively letting high interest devour your funds, consider consolidating those debts into a loan with lower interest. You might even be able to do this through a mortgage refinance.
- Find ways to save on monthly expenses, and put those savings toward your mortgage. When was the last time you really dug into the details of your monthly budget to see what you are spending all your money on? If you take the time to do so and research alternatives to what you are doing now (i.e. cheaper cable), you may find ways you can cut back on those expenses. You then have extra money you can put toward your mortgage every month.
- Refinance if you see interest rates drop. Are interest rates lower now than the rates you are paying? You might feel like this is just a misfortune you have to live with, but that might not be true. Refinancing could be your key to switching to today’s lower home loan rates. That is especially likely if your credit score is better than it was when you signed on your mortgage. So, ask us if refinancing is right for you.
- Refinance or modify your mortgage if you have changes in your future plans. Decreasing your interest rate is not the only possible way to benefit from a refinance or home loan modification. In fact, you might be able to change your loan term or your interest rate format. So, if your plans for the future have changed, do not just passively ignore the impact on your mortgage. For instance, are you going to be moving in a few years? Have a fixed rate mortgage now? The proactive move may be to refinance to a mortgage with an adjustable rate. You can save money for moving thanks to the introductory rate on an ARM.
- Ask questions. Finally, our last recommendation is simply this: ask questions, and lots of them. There is no reason to miss out on an opportunity to pay off your mortgage more rapidly or save money because you are missing information. Your mortgage company is here to give you the answers you need to make the right moves in managing your home loan.
Contact Lending Bankers Mortgage Your Mortgage Professionals in Florida
In fact, if you have questions about your mortgage or are looking for more tips for proactively managing your home loan, Lending Bankers Mortgage would love to help. Please give us a call now at (786) 220-1100 to schedule your appointment!