Paying off your Mortgage
Paying off your mortgage can mean fewer monthly obligations and more flexibility with your cash flow. Get Started
Higher Homeownership Rate is Cost Less Debt
“For many homeowners, adding a mortgage to an existing home is one of the most cost-effective things that you can do,” says Elman. The mortgage payment is only one month’s worth of rent on a conventional $800,000 house.
Over time, that extra house in a lower-priced area can mean fewer monthly expenses fewer interest payments, for example and more opportunity to save for other housing needs. But the fact that mortgage interest rates are currently so low means that potential buyers who earn less than 80 percent of median income can also afford to purchase a home with a mortgage. This also means that some homeowners with lower incomes have no choice but to purchase a home with a mortgage, that’s when it’s important to contact professionals from companies like https://www.sofi.com/home-affordability-calculator/ in order to make the right decision.
Get Your Mortgage Rates in Balance
And, depending on which mortgage rate you choose, you can save more money. The Federal Reserve Bank of New York found that a 20 percent down payment made up by a 1 percent in savings leads to an annual savings of $8,000 on a 30-year mortgage, according to the paper. And a 20 percent down payment and 5 percent savings boost to an annual savings of $22,000.
What if you are down on your home? While there is no guarantee, many loan providers will give you extra money when your current mortgage rate drops below your down payment. Even if you are paying more than your mortgage, you can buy in bulk with a 20 percent mortgage rate with no money down.
If you don’t want to use your home equity or don’t qualify for an FHA mortgage, you may have other ways to borrow money. If you don’t have much money in savings, ask your parents to help you out.
Remember that you can’t get a grant, financial aid or student loans from your parents. Instead, they can help by making a one-time emergency deposit to your parent account or mortgage for you. This will lower the interest rate you are charged on the loan and can add up quickly.