Mortgage payments can be a huge damper on a family’s monthly budget and they seem to last forever. With terms lasting anywhere from 10 to 30 years, that’s a long commitment for anyone to make. However, there are some simple tips that you can do to help reduce the term time of your mortgage and ultimately reducing the amount of money you will pay. Here are some tips to pay back rural home loans faster:
Repaying Rural Home Loans Tips and Tricks
- Higher Monthly Payments– if you have the leeway in your budget, paying 1/12th of a full payment more each month will give you one extra payment over the course of a year. Or individuals can make a double mortgage rate payment once a year, but that might be a less feasible idea for a family budget.
- Refinance– if you’re in a 30-year mortgage term, you can refinance to a shorter-term length and lower interest rate. Switching to a 10 or 15-year term can be a great option. Monthly payments won’t double by cutting your term length in half, which most people find surprising.
- Bi-Weekly Mortgage Payments– if your loan institution will allow, you may be able to pay on a bi-weekly basis. Paying half of your monthly payment every two weeks will give you 26 payments (or 13 full payments) a year instead of 12. Depending upon the length of your term, you can reduce it by as much as 6 or 7 years and reduce the amount of interest paid over the length of the mortgage.
- PMI Reduction– for homeowners who are unable to put down 20% of the value of the home as a down payment, private mortgage insurance fee is added. This extra fee is added until you reach 20% equity. Try to pay more than the minimum payment each month so the extra will go towards the principle, lower the loan amount and bringing your equity up faster.
Finding out More About Arizona Home Loans
For more tips and information on Arizona home loans and financing options for homeowners, visit NOVA Home Loans for the best loan options in AZ, CO, and NV. Visit their website at www.novahomeloans.com.