Reduce Your Home Loan Term
Would you like to reduce your home loan terms? Even if US Mortgages wasn't your primary lender for your mortgage, we can help you reduce your mortgage term. Learn more about how we do this and contact us for more information.
How can US Mortgages help you reduce the term of your mortgage?
Thanks to historically low interest rates, there has never been a better time to refinance your loan into a shorter term. For those who can afford a slightly larger monthly payment, reducing your loan term can mean paying less interest over a much shorter length of time, saving you thousands of dollars over the term of the mortgage.
Did you know that if you refinance a 30 Year Term Mortgage Loan into a 15 Year Term Mortgage Loan, the payments won't be twice as expensive? That's because the loans are amortized differently and your payments will be applied to the principal instead of interest. Another little-known fact is that 15 Year Term Mortgage Loans and 20 Year Term Mortgage Loans typically feature a lower interest rate than a 30 Year Term Mortgage Loan.
What else do we recommend to reduce the loan term on your home mortgage?
Another trick to reducing the loan term on your home mortgage is making extra payments. You can always choose to pay more than the required minimum payment, no refinancing necessary! This is an attractive option for those with tenuous finances who still want to pay off their mortgage quicker. You can make larger payments as often as you can afford, while still having the option of making the basic minimum payment when money is tight. When is the strain of doing this worth it? If you're already close to your mortgage term, this might make the most sense if your household can make the sacrifice. Not only will you save in interest in the long term, in the short term you'll reduce the term of your loan. A final option is to do both: if you make extra payments after refinancing into the same style of 30 Year Term Mortgage Loan, the extra payments will get applied to your principal, bringing your payoff date closer.