November 16th, 2015 6:39 AM by Jackie A. Graves
trying to afford that dream house?
amount, or as we think about it, the amount of debt you are entering, can seem
overwhelming. The easiest thing to do is not to think about the amount of money
you are borrowing, but about the monthly payment. The lower the mortgage
payment, the more house you are able to afford. One of the ways to save
thousands of dollars on your mortgage is by reducing your costs before you even
begin the loan, which creates a lower monthly payment for the life of the loan.
One of the
easiest ways to be able to afford more house is to focus on reducing your
mortgage payment and the fees rolled into the loan from the very beginning.
Small savings from lower interest rates rapidly add up when considering the
life of a 15- or 30-year mortgage. Here are eight ways to jump start saving
money on your mortgage.
Comparison shop mortgage
lenders to see who has
the best rate and terms based on your credit score and income. If you are
already affiliated with a bank or have another loan, ask them if they have a
discount for current members or if you become a member.
comparing lenders, it is important that you review the good faith quote and not
compare the advertised price. Rates are based on numerous factors, and are very
individual. You want to shop the lowest rate you can receive, not the lowest rate
the bank offers.
When you are shopping, compare the APR, not the rate that the banks
are advertising. The APR is the true cost of the loan. By comparing the APR,
you can compare apples to apples.
If you plan on paying your mortgage off
early, you should use a mortgage
calculator to compare
monthly payments between a 15- and 30-year loan. While you can always pay off
your loan quicker, by locking into a shorter loan your rate could be
the types of loans that you are eligible for (VA, FHA, conventional loan,
etc.). If VA and FHA interest rates are significantly lower than conventional
rates, the lower payment could make the loan cheaper, even with the fees
associated with the different types of loans.
about all mortgage programs available. Many institutions have special programs
open to military, firefighters and other specific situations.
If you know
you will be refinancing, selling, or terminating the loan sooner rather than
later, a shorter loan might save you considerable money.
fees (appraisel, postage, and credit check) that you are being charged. If you
want to go with a certain lender but notice that their fees are higher than
other lenders, you can always negotiate.
The most important thing to remember when
trying to save money on your mortgage is that mortages are calculated based on
current economic conditions and your individual situation. The mortgage payment
of a loan on Monday may be different from the same loan on Friday, so getting
mortgage quotes on the same day with the same variables (downpayment, loan amount,
interest rate, mortgage term) – and preferably at the same time – is advised.
This is easiest to manage with the help of online
marketplaces like LendingTree, which offer real-time rates and
custom quotes within just a few minutes.
By Elizabeth Colegrove – To view the
original article click here