If your income is too low or your monthly debts are too high, you may have trouble obtaining a mortgage. However, there are a few ways to lower your monthly mortgage payments:
- Find a home for a lower price: If you find the mortgage payments will be too high, you may need to spend less on your home. Use an affordability calculator to find out the approximate value of the home you can afford.
- Choose a longer loan term: The longer the loan, the lower the payments. However, you will end up paying more interest. A 30-year loan is typical.
- Spend more upfront: When you make a bigger down payment, you are reducing the amount of the loan. If you put down 20% or more, you will also avoid costly private mortgage insurance.
- Find a lower interest rate: Shop around to find a lower rate for your mortgage. The interest adds up, so if you can find a better interest rate, you will be saving a lot of money over the term of the loan.