We all like to save money. Why pay more for something,
when you can pay less? We could all use an extra few dollars in
our pockets, couldn’t we? Most people don’t realize that there are a number of
ways to save money on their mortgage. If you were to take out a
mortgage on a 25 year term, chances are that by the time you repay the entire
loan you will have paid the bank double the amount you borrowed. And you wonder
how the banks are making record profits?
One of the best ways to save money on your mortgage is to
put down the biggest down payment you possibly can. This way, the initial
amount you are borrowing from the bank is lower and the interest you are paying
back will be less than if you borrowed a larger amount. Most of us
do not have tens of thousands of dollars sitting around. If possible, why not
consider borrowing your down payment from a family member? The
banks are not particularly keen on this practice, but if someone in your family
can afford to loan you the money without interest it can be very helpful in the
Another thing to consider, once you have been approved for
a mortgage, is your repayment frequency. Most people opt for a simple monthly
payment. There are other ways, however, to approach this. Why not
increase the rate of repayment? If you can manage making a
mortgage payment either weekly or bi-weekly, you will save thousands of dollars
over the term of your mortgage. Many banks will also allow you to make an
annual lump sum payment on the principle of your mortgage. It is
wise to take advantage of this opportunity, as you are paying directly on the
principle amount of your loan.
For most people, purchasing a home is the single greatest
investment they make in their lifetime. Owning a home provides stability for
your family, and in time you will have a significant amount of equity tied up.
Buying a house can be considered an investment, and you should look at
ways to maximize your investment. There are ways to save money on your
mortgage, and you would be wise to consider all of your options.
Wouldn’t you rather make your money work for you, than to always work for your
money? Short term compromises can lead to long term savings.
Seymore Hennigan has worked in finance for many years. When he is not crunching
numbers or advising his family and friends on investments, he writes freelance
articles for mortgageguide101.com – an independent mortgage guide filled with
extensive information about
buying a new home,
home buying tips,
home buying and more.