How You Can Save Money On Your Mortgage
There are tons of different ways you can save money, both on your way to getting a mortgage and once you have one and are working to pay it off. The nature of having a mortgage is that once you have it, you would be wise to pay it down swiftly if it is at a higher rate of interest than your savings receive. Even if your mortgage is very reasonable and you are easily paying it down faster than you need to, there is always a good reason to save money. The hard part tends to come down to how.
You can save in a lot of ways, particularly with regard to your mortgage. Here are some of the best ways:
1. Pay more than you need to each month. Since mortgages are weighted more toward interest payment, in the beginning, every dollar you pay in the first few years will save you a few dollars in interest across the life of the loan.
2. Start paying before the requirement. Generally, you get between one and three months where you do not have to make a payment at the beginning of your loan. During this time, every day, interest is still accruing on your loan. If you pay that extra two months, you'll save almost six months off of the end. Hopefully, you've already got your finances sufficiently in order to make your monthly payments before your loan has started.
3. Start automatically saving. If you don't have a bank account, get one. Then start transferring a part of every paycheck into a second, separate account that makes accessing your money difficult. This will form a strong base that you can use to save for anything: your home's down payment, an extra payment every year or a roof or A/C repair when the time comes. Making saving automatic makes it easy, and easy things happen slowly but surely.
4. Make sure you get the lowest fees possible. If a fee looks suspect, don't be afraid to walk away. They can't make you sign, and you have a right to avoid potentially thousands of dollars worth of nonsense fees that some companies like to try and impose.
5. Shop around for the best rate. One or two percentage points lower can sometimes save you tens of thousands of dollars across the life of your loan. A few extra minutes can be extremely profitable this way.
6. Shop around for refinancing opportunities.
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