Here are some more mortgage hacks to help you save money on your housing costs.
Do Biweekly Payments
A fast and simple way to pay off your mortgage faster is by doing biweekly payments. Typically, many mortgages have an escrow amount that is specific to your mortgage payments. If you put half of your monthly payment in the designated account every other week, you’ll be set. By using this trick, you will put 13 full payments in your designated savings account. After one full calendar year of paying regular monthly payments, you will now be able to pay for an extra payment in full. This money can now count as additionally principal, which may decrease the costs associated with your mortgage. Before implementing this tip, please check with your loan company to find out if there are any payment rules that are specific to your mortgage.
Put your Escrow back into your Mortgage
Here’s the deal-the payments for your homeowner’s insurance as well as your property taxes comes out of your own escrow account. Every single year, the contents of your escrow account are analyzed to detect any insurance or tax fluctuations that have resulted in either an overage or a payment shortage. If you pay less than what they anticipated, your lender will send you a refund surplus amount check. Now, if you use that money to make extra payments on your mortgage principal instead of cashing it, you’ll save money. This little trick won’t change the amount you need to pay each month but doing this will decrease your total loan balance.
Just pretend you have a Shorter-Term Mortgage
It may be hard to refinance to a shorter-term mortgage since doing so will increase your monthly payments. It can be a lot simpler to not refinance to a shorter-term mortgage, but instead pay your mortgage as if you have a shorter-term mortgage. Try to pay 1/12 of your mortgage payment (principal payment plus interest) each month. Doing so will be the equivalent of paying one extra monthly payment each year. This way, you can pay off your loan faster and save money on interest. Before you do so, please check with your loan company to see if there are any rules on making payments above the minimum amount.
Decrease your Homeowners Insurance Premium
Although homeowner’s insurance is important, there are ways in which you can decrease its cost without decreasing the quality of your coverage. The easiest way to do so is by requesting quotes from many insurance companies and then switch to the policy that’s the cheapest.
This article was written by Ian, an intern at Irish Mortgage Brokers and Yes.ie from the USA.