ArtsAutosBooksBusinessEducationEntertainmentFamilyFashionFoodGamesGenderHealthHolidaysHomeHubPagesPersonal FinancePetsPoliticsReligionSportsTechnologyTravel

How You Can Save Money On Your Mortgage

Updated on November 10, 2012

How Can You Save Money on your Mortgage?

Without getting into different loan rates in this article, there are many ways that you can save on a "traditional" mortgage and not feel the bite quite so hard.

It's all about mortgage savvy and knowing what's available....then knowing which scenario will be best for you.

Let's look at a couple of ways to handle your financial planning when it comes to getting the most comfortable feeling mortgage you can get and becoming more mortgage savvy!

public domain image
public domain image

Tips on How to Save Money on your Mortgage

Here are some great ways to use your mortgage savvy and save money on your mortgage!

  • Years or points. Think in terms of 15 years or points. If you have a great credit history and your debt is completely manageable, think about getting a 15-year mortgage rather than a 30-year mortgage. You can go on line and check out mortgage calculators. Or you can play with the points and see if going that route will save you more in the long run. Either way, these are 2 great ways for folks with excellent credit to save on their house.

  • Add in the closing costs. This has become a commonplace occurrence these days. Instead of paying the asking price for the house you're interested in buying, you and the seller decide that you'll ask him to charge more for the house....the "more" being what your closing costs will be. You add in the closing costs (roughly 6%) to the mortgage sum and that is what you finance the house for. The seller then returns the extra money to you upon completion of the paper signing and you pay the closing costs. Why do this? Well, because you end up not having to pay out of pocket for the closing costs, and yes, you increase what you have to borrow, but your mortgage interest is tax-deductible. The house does have to appraise for the slightly increased agreed upon price, however, but if it does, this is a great way to buy a house and not have to pay closing costs out of pocket.
  • Attack the principal. Another great way to save money on your mortgage is to add money to your payment every month. Also paying half the mortgage every 2 weeks instead of once per month is a super way to bring down the interest faster. Adding just $100 per month towards the principal will speed up how much you actually own outright of your house since about the first 20 years or so are devoted mostly to paying off the interest! It also obviously increases the equity in your home much faster!
  • Financing through the seller. Instead of traditional mortgages, seller financing is where you pay the seller directly. You don't have to borrow the money but instead you agree on an interest rate between you and the seller and then pay him directly every month. This is a great way to get into a home if you don't have good credit and can't get a loan. The downside of this mortgage method is that most sellers aren't going to want to wait 30 years to collect! These are generally short-term loans and while you won't pay closing costs, etc., you may be looking at a 3-year contract.....though it all depends on the seller. Sellers usually agree to this kind of financing so that they don't have to pay capital gains taxes and the owner actually still owns the property until you've paid in if you renege on the debt, he still has the house.
  • Don't believe everything you read or see on TV. Lenders need your money so they need you to take out a loan as much as you need to take one out! Don't take anyone's word for the lowest interest rate. Do your homework. Investigate other lenders in your area and look on the Internet. Check the lowest loan rates and go prepared to the lender you've chosen. Ask them to match the rate that you've found or walk. It's as simple as that. If they want your business, they will reconsider. Loans and interest rates are negotiable! Even getting a reduction of 1/4% is a huge savings over time.
  • Assuming. You can assume an existing mortgage on a home that you are buying. You won't have to go through the hassles of getting a new mortgage and you also avoid most of the costs attached to a new mortgage. If the seller also has a lower interest rate, you come out on top! Make sure that the existing mortgage is transferrable. You'll end up paying the difference between the purchase price and what's left owed on the house. This is a great way to save on a mortgage when there is already a mortgage on the house. But in recent years, lenders have gotten very funny about going with assumed mortgages simply because people that have assumed them have defaulted on them. As the lenders caught on to this practice, they have made it less lucrative and you should know that as a seller, if you are attempting to allow someone to assume your mortgage, you may end up liable in case the assuming party defaults. Assuming is not the recommended way these days to save money on your mortgage though it is still an option.

Mortgage Savvy and How to Save on your Mortgage

In summary, these are a few tried and true ways to make the most of your mortgage payment and covers many different scenarios.

Most importantly in the mortgage game, make sure your credit is stellar before you try and buy a home. You'll be in a much better position for negotiating both price and financing terms.

As the video points out, there really is no reason these days to assume a mortgage and if you enter into an assumed mortgage, you as the owner might get burned so check out other options!

If one of these mortgage styles works for you, do it.......and if not, maybe reducing some of the principal owed is the way for you to go.

If you don't have the ready cash for closing costs, consider the add-on idea to the overall cost but just remember that the home will have to appraise out to coincide with the cumulative cost of the home and the closing costs.

And last but not least, if you find a good rate somewhere, chances are someone else will match it or better it. Don't be afraid to pull out the negotiation card!

Always investigate what your options are and once informed, you will be that much better prepared to make solid decisions.

Wishing you much luck in learning how to save on your mortgage!

Mortgage Savvy

Are Assumable Mortgages Still Around?


This website uses cookies

As a user in the EEA, your approval is needed on a few things. To provide a better website experience, uses cookies (and other similar technologies) and may collect, process, and share personal data. Please choose which areas of our service you consent to our doing so.

For more information on managing or withdrawing consents and how we handle data, visit our Privacy Policy at:

Show Details
HubPages Device IDThis is used to identify particular browsers or devices when the access the service, and is used for security reasons.
LoginThis is necessary to sign in to the HubPages Service.
Google RecaptchaThis is used to prevent bots and spam. (Privacy Policy)
AkismetThis is used to detect comment spam. (Privacy Policy)
HubPages Google AnalyticsThis is used to provide data on traffic to our website, all personally identifyable data is anonymized. (Privacy Policy)
HubPages Traffic PixelThis is used to collect data on traffic to articles and other pages on our site. Unless you are signed in to a HubPages account, all personally identifiable information is anonymized.
Amazon Web ServicesThis is a cloud services platform that we used to host our service. (Privacy Policy)
CloudflareThis is a cloud CDN service that we use to efficiently deliver files required for our service to operate such as javascript, cascading style sheets, images, and videos. (Privacy Policy)
Google Hosted LibrariesJavascript software libraries such as jQuery are loaded at endpoints on the or domains, for performance and efficiency reasons. (Privacy Policy)
Google Custom SearchThis is feature allows you to search the site. (Privacy Policy)
Google MapsSome articles have Google Maps embedded in them. (Privacy Policy)
Google ChartsThis is used to display charts and graphs on articles and the author center. (Privacy Policy)
Google AdSense Host APIThis service allows you to sign up for or associate a Google AdSense account with HubPages, so that you can earn money from ads on your articles. No data is shared unless you engage with this feature. (Privacy Policy)
Google YouTubeSome articles have YouTube videos embedded in them. (Privacy Policy)
VimeoSome articles have Vimeo videos embedded in them. (Privacy Policy)
PaypalThis is used for a registered author who enrolls in the HubPages Earnings program and requests to be paid via PayPal. No data is shared with Paypal unless you engage with this feature. (Privacy Policy)
Facebook LoginYou can use this to streamline signing up for, or signing in to your Hubpages account. No data is shared with Facebook unless you engage with this feature. (Privacy Policy)
MavenThis supports the Maven widget and search functionality. (Privacy Policy)
Google AdSenseThis is an ad network. (Privacy Policy)
Google DoubleClickGoogle provides ad serving technology and runs an ad network. (Privacy Policy)
Index ExchangeThis is an ad network. (Privacy Policy)
SovrnThis is an ad network. (Privacy Policy)
Facebook AdsThis is an ad network. (Privacy Policy)
Amazon Unified Ad MarketplaceThis is an ad network. (Privacy Policy)
AppNexusThis is an ad network. (Privacy Policy)
OpenxThis is an ad network. (Privacy Policy)
Rubicon ProjectThis is an ad network. (Privacy Policy)
TripleLiftThis is an ad network. (Privacy Policy)
Say MediaWe partner with Say Media to deliver ad campaigns on our sites. (Privacy Policy)
Remarketing PixelsWe may use remarketing pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to advertise the HubPages Service to people that have visited our sites.
Conversion Tracking PixelsWe may use conversion tracking pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to identify when an advertisement has successfully resulted in the desired action, such as signing up for the HubPages Service or publishing an article on the HubPages Service.
Author Google AnalyticsThis is used to provide traffic data and reports to the authors of articles on the HubPages Service. (Privacy Policy)
ComscoreComScore is a media measurement and analytics company providing marketing data and analytics to enterprises, media and advertising agencies, and publishers. Non-consent will result in ComScore only processing obfuscated personal data. (Privacy Policy)
Amazon Tracking PixelSome articles display amazon products as part of the Amazon Affiliate program, this pixel provides traffic statistics for those products (Privacy Policy)
ClickscoThis is a data management platform studying reader behavior (Privacy Policy)