EXIT Realty Foothills Gives Mortgage Saving Tips

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Contact:
Jessie Eide
Realtor
EXIT Realty Foothills
909.593.0502
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EXIT Realty Foothills Gives Mortgage Saving Tips

7 Ways to Save on Your Mortgage

La Verne , Ca (Grassroots Newswire) 12/2/2010 --

These days everyone is trying to save a little bit of money and for the majority of us the mortgage is the biggest bill we have. So the question becomes how can we save a little bit on our mortgage by either reducing the monthly payment or by paying of the loan faster?

Nate Moch from Zillow.com gives us an example of how to do this. Obviously each mortgage is different so it will be different savings for each loan, but Moch walks a through a $200,000; 30-year-fixed; 6% interest; creating a monthly payment of $1,199 including principle and interest. With that being said, here are the 7 tips:

1. Make and extra payment each year – I know during this economy that seems impossible but if you can figure out how to make an extra payment the savings are enormous. According to Moch "By making one extra payment of $1,199 each year and applying it to your principal, you could save over $47,000 in interest and cut 5 years off the life of the loan."
   
   
2. Create a Bi-Weekly Payment – This would essentially do the same thing as making an extra payment
   
   
3. Scratch your PMI – Your mortgage lender may not allow you to do this if you put down less than 20% when you created the mortgage, but if you have been paying down the mortgage or the loan is less than 80% of the home's appraised value, you may be able to negotiate with the mortgage company. The savings could be up to $130 a month.
   
   
4. Property Taxes – If you think your property is too highly valued by the tax assessor, you can petition to lower your assessment. This could save you thousands of dollars a year depending on each property.
   
   
5. Recast the Loan – When you put extra money toward the principle you can have the mortgage company reset your monthly payment. Instead of shortening the length of the loan by putting extra money toward the principle you can recalculate the interest. If you put an extra $20,000 and recast the loan you could save $120 a month.
   
   
6. Loan Modification – Not everyone qualifies for this, but if you are having a financial hardship you can try to modify the terms of your loan. Of course, savings will vary.
   
   
7. Refinance – The last and most common way to say is to refinance. When you refinance you lower your interest rate. Of course there is cost to refinancing so it is important to speak with your financial advisor before doing this. Again this way of saving will vary depending on the individual loan.

For more information about EXIT Realty Foothills, please call 909.593.0502. EXIT Realty Foothills is located at 1339 Foothill Blvd, La Verne CA 91750.

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