Tight budget? How to Lower Your Monthly Mortgage Payment!

If you’re facing a tighter-than-you’d-like budget this year, lowering your monthly mortgage payment might be easier than you think. 

Here are 4 ways to consider:

Drop PMI

If you've paid down your mortgage to the point where you have 20% equity in your home, you might be eligible to remove Private Mortgage Insurance (PMI). It's a great feeling — suddenly, everything feels lighter. Just keep in mind that for your PMI to be canceled, you need to be current on your payments.

Extend your loan term

Think of your mortgage like a pie. The longer the term, the smaller the slices (or monthly payments). Extending your loan term can reduce your monthly payment, though it might increase the total interest paid over time.

Recast your mortgage

This is a lesser-known but effective method. By making a large lump-sum payment towards the principal, you can have your lender recalculate (or "recast") your loan based on the new balance. This could significantly lower your monthly payments.

Shop around for Homeowners Insurance

Don't settle for the first insurance rate you find. Shopping around can uncover better deals — you might be surprised at how much you can save. Just be careful. Given the uptick in natural disasters and rising rebuilding costs, some insurers are hesitant to write new policies.