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5 ways to lower your mortgage payment right now
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Americans have seen the overall cost of living increase by nearly 20% since 2020, which is causing budgets to be stretched, and in some cases, significantly. For many, following common advice like meal planning, cutting down on luxuries and picking up a side gig just isn’t closing the financial gap.
If that’s your experience, it may help to rethink one of the largest monthly expenses most people have — your mortgage. The median monthly mortgage payment in the U.S. is currently $2,843, which is up nearly 13% compared to one year prior.
But how can you reduce your mortgage payment if you need help today?
Find out what today’s top mortgage loan rates are online now.
5 ways to lower your mortgage payment right now
From loan modifications and refinancing to removing mortgage insurance, here are five ways experts say you can lower your mortgage payments on short notice.
Modify your loan
If your financial situation permanently changes and you can no longer comfortably afford your mortgage, your lender or mortgage servicer may be willing to modify your loan.
“Modifications can include lowering the interest rate, extending the loan term, or reducing the principal amount owed to make payments more manageable,” says Andrew Latham, certified financial planner, certified financial counselor and content director at SuperMoney.
To go this route, you’ll need to contact your lender or servicer, explain your situation and ask if a loan modification is an option. It’s important to note that modifications may lower your monthly payment amount but add to your overall costs due to extra escrow fees, interest and other costs. For personalized guidance and assistance, you can reach out to a HUD-approved housing counseling agency.
Compare your best mortgage loan offers and get the application process started today.
Apply for forbearance
Mortgage forbearance can be a good option if your current financial problems are temporary, such as if you lost your job and are seeking a new one.
“Forbearance temporarily reduces or pauses payments—although interest may still accrue,” says Latham.
Similar to the steps with loan modifications, you’ll need to reach out to your lender or servicer to see if forbearance is an option. The timelines, interest implications and repayment terms can vary by lender and situation.
Recast your mortgage
Another way to reduce your payments is to make a large lump-sum payment toward your principal balance and recast your mortgage. In this case, your lender will re-amortize your remaining payments based on your reduced outstanding principal balance and existing mortgage rate.
However, you should beware that lenders won’t automatically recast your payments in response to a large payment. You’ll need to find out if it’s an option and get an agreement upfront.
Refinance your mortgage
You can also look into refinancing your mortgage which involves replacing your current loan with a new one.
“Refinancing can be a great option if mortgage interest rates are lower now than when you purchased the home. By refinancing to a lower interest rate or extending the term, you may be able to decrease your monthly payments,” says Gloria Garcia, certified financial planner and wealth manager at LourdMurray.
Unfortunately, due to the current interest rate environment, finding a lower rate will be difficult if you bought before the fall of 2022.
“Current interest rates are not low, so sadly, this may not make sense,” says Garcia.
But rates have dropped since peaking in October of 2023 and could drop further this year if the Fed gets inflation under control, so refinancing could make sense for more recent buyers. The only way to find out is to collect mortgage quotes and run the numbers to see if you can save monthly and over the life of the loan (closing costs and all).
Remove mortgage insurance
Many mortgage programs allow you to put down less than 20% of the purchase price if you buy private mortgage insurance (PMI). However, you don’t always have to keep the PMI until the end of the loan.
“If you’ve made progress towards your principal and now have 20% equity in your home, you can request the removal; this could save you hundreds of dollars a year,” says Garcia.
The bottom line
Although there are various ways to lower your mortgage payments, Garcia recommends starting with an old-fashioned review of your budget, “Mortgages tend to be an individual’s highest expense, but there are others one can reflect on.”
She recommends reviewing your spending and budget in search of unnecessary expenses. If you’re still coming up short after trimming all you can, then Garcia recommends reaching out to your lender.
Further, you could turn to your home equity.
“Use of other forms of mortgage products such as second mortgages or HELOC’s (Home Equity Lines of Credit) could also be a consideration, especially if someone currently has a low mortgage rate,” says Rick Mount, managing partner of the Southwest Region at Churchill Mortgage. “Consolidating high rate debt using one these options can usually save significant cashflow each month, making life just a little easier.”
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Bela Karolyi, the charismatic if polarizing gymnastics coach who turned young women into champions and the United States into an international power, has died. He was 82.
A spokesperson for USA Gymnastics confirmed to CBS News by email that Karolyi died Friday. No cause of death was given.
Karolyi and wife Martha trained multiple Olympic gold medalists and world champions in the U.S. and Romania, including Nadia Comaneci and Mary Lou Retton.
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“A big impact and influence on my life,” Comaneci, who was just 14 when Karolyi coached her to gold for Romania at the 1976 Montreal Olympics, posted on Instagram.
The Karolyis defected to the United States in 1981 and over the next 30-plus years became a guiding force in American gymnastics, though not without controversy. Bela helped guide Retton — all of 16 — to the Olympic all-around title at the 1984 Games in Los Angeles and memorably helped an injured Kerri Strug off the floor at the 1996 Games in Atlanta after Strug’s vault secured the team gold for the Americans.
Karolyi briefly became the national team coordinator for USA Gymnastics women’s elite program in 1999 and incorporated a semi-centralized system that eventually turned the Americans into the sport’s gold standard. It did not come without a cost. He was pushed out after the 2000 Olympics after several athletes spoke out about his tactics.
It would not be the last time Karolyi was accused of grandstanding and pushing his athletes too far physically and mentally.
During the height of the Larry Nassar scandal in the late 2010s — when the disgraced former USA Gymnastics team doctor was effectively given a life sentence after pleading guilty to sexually assaulting gymnasts and other athletes with his hands under the guise of medical treatment — over a dozen former gymnasts came forward saying the Karolyis were part of a system that created an oppressive culture that allowed Nassar’s behavior to run unchecked for years.
Still, some of Karolyi’s most famous students were always among his staunchest defenders. When Strug got married, she and Karolyi took a photo recreating their famous scene from the 1996 Olympics, when he carried her onto the medals podium after she vaulted on a badly sprained ankle.
Despite losing his boxing match to Jake Paul, Mike Tyson in a social media post Saturday said he had “no regrets” to getting “in ring one last time.”
The boxing legend was defeated by social media star Jake Paul in a highly anticipated fight on Friday night with an age difference of over three decades between the two contenders.
Netflix said Saturday that 60 million households worldwide tuned in to watch the match. The two fighters went eight full rounds, with each round two minutes long. Paul defeated Tyson by unanimous decision and the 27-year-old upset boxer and 58-year-old former heavyweight champion hugged afterward.
Paul was expected to earn about $40 million from the fight, and Tyson was expected to take around $20 million for the fight, according to DraftKings and other online reports.
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Tyson said on his social media that “this is one of those situations when you lost but still won. I’m grateful for last night.”
The fight almost didn’t happen after Tyson experienced an ulcer flare-up while on a plane in March. He addressed his illness Saturday, writing that he “almost died in June.” He said he had eight blood transfusions and “lost half my blood and 25lbs in hospital and had to fight to get healthy to fight so I won.”
Tyson retired from boxing in 2005 after a 20-year career. He last fought in a 2020 exhibition match against former four-division world champ Roy Jones Jr.
“To have my children see me stand toe to toe and finish 8 rounds with a talented fighter half my age in front of a packed Dallas Cowboy stadium is an experience that no man has the right to ask for. Thank you,” he said.
Alex Sundby and
contributed to this report.
