Life is full of change - and where big life changes are happening, big financial change is sure to follow.
From new jobs to new babies, paid-off debts to new expenses, the cash flow in and out of our bank accounts each month can fluctuate. So why should we be stuck with the same mortgage payment?
Whether you are in a fixed or variable rate mortgage, there are several small changes we can make to ensure your monthly payment makes sense for your financial situation today. We can review your mortgage at any time (I suggest at least annually), assess any changes, research current offers and make structural changes that could save you money every month! A few of the most common ways we can reset payments include:
Consider your amortization: Particularly if you currently have a variable rate, extending your amortization to stretch your balance out could be the ticket to keeping your cash flow every month but not losing the benefits of your variable mortgage.
Strategic prepayment: We talk a lot about the penalties you could be on the line for if you pay out your mortgage early, but we don’t pay as much mind to how wise prepayment can be a powerful tool. Most mortgages have terms that allow you to make incremental increases to your payment. If you’re worried about where rates will be when you come up for renewal, this is a great way to ensure you’ve budgeted for more each month ahead of time!
Go variable: Yep, you read that correctly! History indicates that even with fluctuation, variable rate holders save money over time. With few exceptions, variable rates have almost always remained lower than fixed, keeping monthly payments down. If you are comfortable with a bit of risk, this option could keep the most cash in your pocket in the long run.
Remember it’s never a bad time to review your mortgage! Give me a call so we can review and reset to ensure you are getting the best deal for your needs today!