You might be fooled into putting off your dream of buying a home until you come into a substantial amount of money. Most people are scared of the mortgage repayments for new Pickering townhomes. They thus save for as long as possible to ensure they have enough money to buy the homes without taking mortgages. This is commendable but often challenging. Fortunately, you can lower your mortgage repayments with the right strategies to enable you to buy a home without straining financially. Here are ways of reducing mortgage repayments.
Extend the repayment term
Extending a mortgage repayment term is also called re-amortization. Thankfully, most lenders only charge a low basic fee for this service. For example, by extending a 15-year home loan to thirty years, the monthly repayments are less. Though you often pay higher interest rates with this alternative, you will not struggle with high monthly loan repayments.
Make large down payments
Instead of saving money to pay the entire purchase price of new Pickering townhomes, use the cash for a large down payment. Most lenders ask for 20% of a property’s purchase price as a down payment. Paying more than this allows you to borrow a lower mortgage. It also reduces the amount of your private mortgage insurance. Both steps will lower your monthly loan repayments.
Settle for an interest-only mortgage
Some mortgage types do not call for the repayment of your loan’s balance right away. For example, interest-only mortgages require you to pay interest on the loan then pay your principal balance and remaining interest later. This means the monthly repayments of your mortgage will be low in the first few years.
There are multiple ways of reducing your mortgage repayment. The above are only a few that will ease the repayment of home loans for new Pickering townhomes. Discuss your financial circumstances with a lender before settling for an option that best suits you.
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