There are times when we are in need of money desperately. But sometimes, it happens that either there is a cash crunch or there is a shortage of liquid funds at your disposal since you might have invested your surplus money in investments having a high lock-in period. Instead of breaking your investments before maturity, the best approach that is suggested by experts is to take out a loan against property to meet your current cash requirements for any of your personal expenses.
Although, it is generally recommended to keep mortgage costs low, preferably 30% of your take-home income. However, at times you might have to take a high mortgage loan to meet your sudden personal expense. This might lead to a high EMI mortgage loan which you have to pay every month. This may account for a large part of your income leaving very little to cover the rest of your monthly expenses.
That is when you might want to consider lowering your home’s mortgage payment. However, doing this indicates that you will have to pay an increased mortgage loan interest rate in the future.
But do not worry, as we will guide you to come up with six exciting ways to apply for mortgage loan and reduce your mortgage loan repayment effectively.
1. Expand Your Repayment Term
If you cannot think of ways to decrease your mortgage loan, extending your term can be an effective way to do it. If you plan to extend your mortgage loan tenure from 10 to 20 years, then the monthly payment is likely to decrease. This is because now you have more time to pay back the loan against property that you have taken by expanding your term & increasing the number of Mortgage loan EMIs. By doing this, you will also end up paying more interest on your mortgage loan over time with this option. But this can be the best option for those borrowers who need an immediate solution to the cash flow issue.
2. Refinance Your Mortgage
Despite the benefits, many people disagree with the idea of extending mortgage repayment terms. That is when you can consider refinancing your mortgage. This will help you make sure that you have a lower interest rate and an effectively smaller monthly payment. If you think you have good credit at hand, you can easily opt for refinancing your existing mortgage and save tons of money.
If you are opting to refinance a Mortgage loan, make sure you choose a lender that keeps the fees low. Check for lenders where you can avail yourself of the option of transferring your existing loan against property & ease your EMIs with simplified balanced transfer solutions at reduced interest rates & fees with a top-up facility. Mortgage Loan interest rates differ from lender to lender. So, if you know of a lender offering a lower rate, consider transferring your Loan against property (LAP). One economical Mortgage Loan or property Loan you can avail of is Standard Chartered Mortgage Loan.
3. Select An Interest-Only Mortgage
Many lenders will not demand you to start paying off your balance immediately. The interest-only mortgage will take place in two different stages. In the first stage, you will need to pay interest on your mortgage, and in your second, you will have to pay off the actual principal balance along with interest. So you can consider this for your mortgage.
4. Rent Out A Portion Of Your Home
If you own an ample space, a tenant can help you to decrease the monthly mortgage payment. So, no matter where you have extra space, you can transform it into a room and rent it out to a reliable tenant.
5. Get Your Home’s Tax Assessment Redone
Property taxes are a massive problem to deal with. They are based on every county tax assessment of how much is the worth of your home. So, you can request to get the evaluation done again from trusted professionals & seek their advice wherever required.
Consider Opting for Floating Interest rate Loan against property.
If you think you might end up having surplus funds in the future, then you may want to consider the option of buying a mortgage loan at a floating rate of interest. This type of loan usually gives the benefit of prepaying or foreclosing your loan at no extra charges. However, it is advisable to first weigh the pros & cons before opting for a floating interest rate mortgage loan.
The Bottom Line
These are some of the most effective ways to reduce your mortgage payment. Make sure to use them to your advantage as far as possible.
You can also check for Standard Chartered mortgage loan interest rate, eligibility & documents. Apply for a mortgage loan & borrow up to 70% of your residential or commercial property’s market value for personal expenses.