Here are 8 ways to save money on your mortgage!
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Improve Your Credit Score: A higher credit score often translates to better interest rates. Pay your bills on time, keep credit card balances low, and avoid opening new credit accounts unnecessarily.
- Consider a Shorter Loan Term: While a 30-year mortgage may offer lower monthly payments, opting for a 15 or 20-year term can save you thousands in interest over the life of the loan.
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Make a Larger Down Payment: Putting down a larger down payment can reduce the amount you need to borrow and may qualify you for a lower interest rate.
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Refinance Strategically: Keep an eye on interest rate trends and consider refinancing your mortgage if rates drop significantly. However, be mindful of closing costs associated with refinancing.
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Pay Points: Paying points upfront can lower your interest rate over the life of the loan. Calculate whether the upfront cost of points is worth the long-term savings in interest.
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Avoid Adjustable Rate Mortgages (ARMs): While ARMs may offer lower initial interest rates, they can become more expensive if rates rise in the future. Fixed-rate mortgages provide stability and predictable payments.
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Make Extra Payments: Even small additional payments toward your mortgage principal can significantly reduce the amount of interest you pay over time.
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Avoid PMI if Possible: Private Mortgage Insurance (PMI) is typically required for borrowers who make a down payment of less than 20%. Saving up for a larger down payment can help you avoid this extra expense.
