When you sign on the dotted line for your new Chetek WI home, it is true that the loan is now your responsibility to pay for as long as the term dictates. However, that doesn’t mean you cannot pay off the loan early! There are many ways to rid yourself of your monthly mortgage payment ahead of schedule, regardless if the interest rate is fixed or adjustable.
1. Refinance into a lower rate without lowering payments
Refinancing your mortgage can bring down your payment significantly, especially if you previously locked in a much higher rate. You may like to consider taking advantage of today’s lower rates, but keep your payment the same in an effort to cut down the years you will owe on your loan.
2. Refinance into a 15-year mortgage
If you can swing a higher payment, you may want to refinance your loan into a 15-year term. Not only will this cut your traditional 30-year-mortgage term in half, but these also typically come with lower interest rates which will help you pay less over the life of your loan.
3. Make extra or higher payments
There is nothing wrong with making your standard payment every month, but the amount you will owe in interest can add up to hundreds of thousands over time. If you can add even $100 on to your monthly payment, you can reduce the total interest by as much as $25,000 and you’ll cut down your pay-off time by over five years!
4. Get rid of your private mortgage insurance (PMI)
If you put down less than 20 percent on your Chetek WI home, chances are you’re paying private mortgage insurance (PMI). However, once you reach an 80 percent loan-to-value ratio, you can request to have it removed; once it reaches 78 percent, your lender is required to remove it.
Remember, we’re here for you long before you sign those mortgage documents. You can count on Six Lakes Realty to guide you through the process of buying a home in the Chetek area, from home search to home closing.
Give us a call today!
Six Lakes Realty
Office: (715) 924-4806