Everyone wants to lower their mortgage rate without having to refinance, but few of us actually think that there’s a way to do so. Well, there is. Here are a few methods for lowering your mortgage rate without going through the hassle and trouble of refinancing.
#7 YOUR BANK FEES
Bank fees can be reduced or eliminated in some cases, when you maintain excellent credit. A great way to work towards a lower mortgage rate is to keep your credit rating high, and stay on top of those bank fees. If your bank sees that you’re dependable, when it comes to paying off your debts, you may just get a nice surprise, in the form of a lower mortgage rate.
#6 LOSS MITIGATION
Start off by Calling your lender, and talk to their loss mitigation department. The department has the ability to reduce mortgage rates. Tell them that you are in the middle of a financial hardship, and require a loan alteration that reduces your mortgage rates. You will have to provide proof of the hardship, but provided you can do that, they more likely than not will honor your request.
#5 CROSS YOUR T’s AND DOT YOUR I’s
Being accurate can go a long way towards swinging a decision. It’s always important to be both punctual and accurate. Provide your banks with all necessary documentation, when requesting a reduced rate. From bank statements, to a hardship letter that explains your issues clearly and concisely. If the loan modification is approved, your interest rate will drop.
#4 YOUR MORTGAGE PLAN
While it may not seem like the best way to solve your problems, you should consider the option of a fifteen year mortgage. While this is a shortened time commitment, you will ultimately save thousands in interest costs over the entire duration of time. Compared to longer mortgages, it may be worth it, provided that you can swing the payments.
#3 AUTOMATIC PAYMENTS
Some providers offer interests breaks if you set up automatic payments for your mortgage. It’s not a bad offer, but keep in mind that if you close your account, the bank can then in turn raise your rate back up to where it was previously. The lower loan rate will give you real savings, and works best if you have no plans on leaving your current bank.
#2 HOUSING COUNSELOR
If you’re just looking for choices and alternatives, but aren’t sure where to start, you can always get in touch with an approved housing counselor, for their advice. They’re great for offering free advice on how to reduce your mortgage costs. In some cases, a good counselor can help negotiate with your lender as well.
If your credit isn’t perfect, you’re going to want to proceed with a loan reduction carefully. Everyone has three different scores; one from each credit bureau. For the most part, banks use your middle score, when making a decision. Also keep in mind that if you’re in a relationships, and one of you has poor credit, it makes better sense to take out the mortgage in the name of whichever one of you has the higher credit. This will help when asking for a reduced rate as well.