A high mortgage payment always feels like huge pressure. Especially if the monthly payment is tight for the client. Luckily there are plenty of ways to lower the mortgage by refinancing.
Refinance to a lower interest rate
Homeowners generally refinance so that they can lower their mortgage interest rate. It also helps to save thousands of dollars if done at the right time. Primarily the client has to pay for over two years over the existing mortgage. If the financing has improved, then there is a good chance that the bank will lower the monthly mortgage payment.
Extending the loan term
Another viable option is to extend the loan terms by discussing them with the bank authorities. This simply means that the time will expand and you will get more chances to pay back the bank. In addition, they will lower the monthly payment which can facilitate you big time. But there is a twist. This strategy will only work if you have a low-interest rate. Another point is that you could end up paying more than you initially agreed.
Refinance to a fixed-rate mortgage
If you have an adjustable-rate mortgage (ARM), which offers a fixed rate with a variable interest rate after a certain year. The rate may go down or up depending on the situation. In case you refinance a new fixed-rate mortgage loan, you can deduct the change of mortgage amount shifting. This provides certainty for the payback amount.
Use a streamlined refinance
Streamline refinance is available on many FHA, VA, and USDA home loans. They provide lots of benefits like not checking the home appraisals, re-check the income, and many more.