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Mortgage Loan Check-Up, Could You Save More Money?

Updated on September 8, 2013

How's the life of your loan?

Does your mortgage need a check-up?
Does your mortgage need a check-up? | Source

What is a Mortgage?

A mortgage is another name for the deed that explains the terms of the loan on real estate or property. Generally, people don't have thousands of dollars to buy a home. The answer to home ownership is to go to a big bank and ask to borrow money for such a large purchase. Banks make money by lending the money to the borrower with an agreement to pay the money back and add a little interest to the loan which is repaid in monthly installments.

It's really boring information unless you work in the industry. So what do people do?

They go through all the hoops to buy a home and then once the deal is closed, they pay their monthly mortgage payments and don't think about it much.

It might pay to re-evaluate the terms of your loan. There are a few ways that you might be able to reduce your mortgage payments and save thousands in the long term.


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What is PMI?

Private Mortgage Insurance

Many times banks will require borrowers to carry Private Mortgage Insurance. Typically, if you put less than 20% for your down payment on the property, the bank or lending institution can tack on the PMI. They charge you money until you have about 20% equity in your home.

It might pay to review the terms and type of loan that you currently have on your property to see if there is a PMI and if you can have it removed. Sometimes it is just a simple matter of writing a letter to the bank to request that the charge be removed. A loan officer should be able to explain if and when this can happen if they required PMI.

Do your homework and save money!
Do your homework and save money! | Source

Is it time to REFI?

Refinancing Your Loan

Is it a good time to refinance your loan? It might pay to call your lender to find out the details of your loan. What was the interest rate? You might be able to secure a better rate which could drop your monthly payment.

The real estate market and the finance sector are extremely volatile. The rates can change every single day. What might have been a great rate when you borrowed could be high at the current date. It's well worth your time to investigate these details. Call your lender and find out if it's feasible for you to refinance the terms of your loan. Caution is required because some lenders may charge loan origination fees or they may offer to allow you to borrow more money for the equity you've gained in the home. I am personally against taking equity out because then I'm back to square one. My idea is to pay my mortgage off as soon as possible for the lowest rate I can acquire.

For example, I can remember when interest rates were 12% and right now, I've seen rates drop to 4% and lower at some institutions.

It's a dirty deed...but someone's got to do it!
It's a dirty deed...but someone's got to do it! | Source

What about reducing the length of the loan?

Many people are now taking advantage of 15 year mortgage loans rather than typical 30 year loans. It doesn't hurt to call a lender to find out if it makes sense for you to renegotiate the terms of your loan.

It's also a good idea to find out how your payments are divided. I know many people who include additional payments on their mortgage with instructions for the lender to apply the extra money to their principal portion of their loan. This can reduce your loan by several years if you are consistent in doing so. Paying an additional $50 dollars a month can make a huge difference depending on your loan amount.

It always pays to understand the details behind the terms of your mortgage. Taking a few minutes can save years on the length of time and money you will repay for your home loan.



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  • cclitgirl profile image

    Cynthia Calhoun 4 years ago from Western NC

    Good advice. Refinancing is a great way to go: we did that and came in at 2.9%!! And we'll have the house paid off hopefully before I turn 40. LOL

  • RealHousewife profile image

    Kelly Umphenour 4 years ago from St. Louis, MO

    Hey Paula! So good to see you!! Thanks so much! I've missed you too and yep just been on the run! Constantly something is going on...but I'm working my way back to you babe! (Haha! That's a great song though isn't it??)

  • RealHousewife profile image

    Kelly Umphenour 4 years ago from St. Louis, MO

    Hi drbj! I've really been missing being on the HP and have been trying to get back to it! I'm so far behind I can see my own butt - other than that? It's all good! Thanks so much!!

  • fpherj48 profile image

    Paula 4 years ago from Beautiful Upstate New York

    WOW!.....What should I ask? Where have YOU been...or where have I been? Actually, I know where I've been.....a month and half in Georgia, getting to know my 3 mo. old Twin grandsons! What a trip!

    I read this word for word...beginning to end with huge interest ( pun intended).....Finding myself alone again and the sole responsible person for all finances.....I need all the advice, info and help I can get!.....Thanks Kelly....I've missed you girl. UP+++

  • drbj profile image

    drbj and sherry 4 years ago from south Florida

    Thank you, Kelly, for taking the time and effort to share such realistic and important information for home buyers who often do not understand all the terms of their home mortgage. Been missing you, m'dear. Hope all is well with you and yours.

  • RealHousewife profile image

    Kelly Umphenour 4 years ago from St. Louis, MO

    Hi Eddy! Great to hear from you!

    Thanks so much...I hope people can use the info to save some bucks!

  • RealHousewife profile image

    Kelly Umphenour 4 years ago from St. Louis, MO

    Hey Frog Prince! Good to see ya!

    I think so many people do not have a clue about mortgage or interest rates...they just keep paying the figure in the box and some may not realize it can be cheaper to refi!

  • Eiddwen profile image

    Eiddwen 4 years ago from Wales

    Such an interesting hub and one to benefit many I am sure. Have a great day.


  • The Frog Prince profile image

    The Frog Prince 4 years ago from Arlington, TX

    Good info for the uninformed.

    The Frog

  • RealHousewife profile image

    Kelly Umphenour 4 years ago from St. Louis, MO

    Thanks DDE!

  • DDE profile image

    Devika Primić 4 years ago from Dubrovnik, Croatia

    A useful hub on Mortgage Loan Check-Up, Could You Save More Money informative and helpful

  • RealHousewife profile image

    Kelly Umphenour 4 years ago from St. Louis, MO

    Thanks Susan! I'm so glad to have some time to get back to it:) lol.

    Oh good point you added too...some people do pay bi-monthly! That's an option I've never used before so thank you for bringing it up!

  • Just Ask Susan profile image

    Susan Zutautas 4 years ago from Ontario, Canada

    We remortgage every 5 years. So far it has paid off as each time we've done this our fixed rate has gone down. We also pay off quicker by paying our mortgage every two weeks.

    Great hub and it's so nice to see you writing again!