How To Lower Your Mortgage Payment?

Everyone has to live somewhere, but sometimes it feels like the cost of living in the home of your choice can be overwhelming. If you’re thinking about ways to lower mortgage payment, there is help available.

Refinance The Mortgage

Whether you should refinance mortgage depends on a couple of things – how old the loan is, and the difference between your current mortgage interest rate and your potential interest rate. So, think before you decide to refinance mortgage.

Home loans amortize. What that means is that most of your payments at the beginning of the loan go toward interest, and the payments at the end of the term go toward the principal. At the end of the term, the mortgage interest rate has less of an impact. So, the newer the mortgage, the more desirable is refinance mortgage.

Cancel Your PMI

If you bought your home using a down payment of under 20%, you’re likely paying PMI, and that can add thousands to your mortgage over any given year. The good news is that you won’t have to pay it forever. Once you’ve paid off enough of your mortgage that you have 20% equity in your house, you can have the PMI cancelled.

What you need to do is get in touch with your lender and ask him to have the PMI dropped -he won’t do it automatically. Likely, the lender will send an appraiser out to look at your home and determine its value before they’ll agree that you have 20% equity.

Extend Your Mortgage

If you’re currently under a 15-year or 20-year mortgage, you could consider extending it to a 30-year term. Of course, this will mean that your mortgage interest rate will go up, but you will have considerably lower mortgage payment. And often, you can arrange to make extra payments from time to time without being under the obligation of making the large payments that you were making under the shorter term. Overall, there will be lower mortgage payments, and if you should happen to have an emergency that requires cash outlay, all your resources won’t be tied up in mortgage payments.

Challenge Your Tax Assessment

Your lender collects property taxes monthly, and those tax payments sit in escrow until the tax bill comes due. A lot of the time, property assessments are far too high. For lower mortgage payment, you can file a protest with the county, or request a hearing with the State Board of Equalization. If your dispute is approved, your tax rate drops, and so do your monthly mortgage payments. Note, though, that an assessment and an appraisal are two different things The County assesses for tax purposes. An appraisal is for the purposes of loans.


It is possible to have lower mortgage payments. But be wary of extending the term of your mortgage, because although you’ll be paying less in the run of any given month, you’ll end up paying more for your home over the long term. If you can get your tax assessment reduced, though, that’s all win and no loss for you.