Saving Without Refinancing: Top 4 Ways to Spend Less on Your Mortgage

It seems you can’t open a newspaper or look anywhere online without hearing about refinancing. This makes sense, of course, given the current low-but-climbing interest rates. In fact, we’ve written plenty on the subject.

savings photoRefinancing allows you to get a lower interest rate, which decreases your monthly payments and the amount of interest paid over the life of the loan. But what happens if you want to refinance, but can’t (not everyone is eligible or qualified)? There are still ways to save money on your mortgage if you are unable to refinance. Here are four of them:

1) Pay More (and More Often)

Let’s say your credit won’t allow you to refinance, but you find yourself with more money coming in. You can make an extra mortgage payment each year or choose to pay more each month, which equates to paying your mortgage off faster, thereby saving on interest. If you pay more or extra, you are paying off your balance faster, and extra payments get applied to principal, not interest.

2) Remove Your PMI

If you paid less than 20% for your down payment, chances are you had to pay private mortgage insurance (PMI). But did you know that you can petition to have your insurance canceled once your balance falls below 80% of the home’s appraised value? In this way, you can save hundreds each month.

3) Modify Your Loan

For those going through financial hardship, there are programs available that actually allow you to modify the terms of your loan, including the rate and term. These programs are designed to allow people to stay in their homes and keep up with their payments; not everyone is eligible, but talk to your lender or mortgage broker to see if this is an option for you.

4) Lower Your Tax Assessment

Home values don’t always rise. While we’d all prefer that they did, the good news is that if the value of your home decreased, you can petition for a new tax assessment, which would lower your property taxes and save you hundreds of dollars each year. It’s worth fighting for.

While refinancing is a great way to save money, all hope is not lost if you’re not qualified. Speak to an experienced broker who can help you find alternative ways to save and make your mortgage as affordable as possible.

If you’re buying or selling a home in the Boston area and are in need of a mortgage, or have any mortgage-related questions, contact me at any time for advice or help.

Phil Ganz (354 Posts)

Philip D. Ganz is a Boston Mortgage Broker and Boston Home Loan specialist. For information, expertise, consulting, or advice about home loans, refinancing mortgages, or commercial property loans, contact Phil with no obligation: 617-529-9317

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