How to reduce mortgage payments?
When the value of your home increases or decreases, this will determine how much your monthly mortgage payments will be.
So let’s get straight to the guide (if you need more of an explanation first, scroll down):
- Your first point of call is Zoopla. Click on “get a zoopla estimate”. Enter your postcode. Click on locate address. Select your property and click on “get estimate”.
- You will find yourself on a page that asks you questions about your property. Select which ones reflect the current condition of your property then click “continue”.
- Don’t forget to state how much you have spent on improvements etc, then select “get estimate”.
- You will then be asked to sign in or register.
- You may find the estimate of your house value goes up which means your loan to value will be lower on a mortgage (you could then be offered a lower interest rate which could mean a lower monthly mortgage payment).
- Print out a copy of the estimate and use this information to search for a new mortgage with a new lender or give this to your current lender.
- Get three estate agent valuations on your property.
- Use these to search for a new mortgage with a new lender or give this to your current lender to see if you get a deal.
Why should I do this?
Not all mortgage companies send out valuers to a mortgage applicants property to check its current value.
Over time, your property (in some areas) will naturally increase in value, however YOU may have added value yourself by adding a bathroom, giving it a lick of paint, landscaping the garden, converting the loft or even making a loft room, adding an extension or refurbishing your kitchen.
For example: If you purchased your property two years ago on a fixed rate mortgage for two years and that term is coming to an end, you may want to approach the lender again about fixing yourself into another fixed term.
Your current lender may send you an offer in the post but they are not aware that you have carried out improvements.
You may tell your lender on the phone about these additions and modifications but they may still offer you the same rate.
A MORTGAGE LENDER SHOULD SEND A REPRESENTATIVE TO YOUR PROPERTY TO VALUE IT BEFORE THEY SEND YOU AN OFFER IF YOU HAVE MADE ANY CHANGES TO THE PROPERTY.
If you can answer yes to any of the following questions you should follow our guide above to make this a reality:
- When you last remortgaged, did your mortgage provider send an assessor to your property to check its value prior to sending out a mortgage offer?
- Are you on a variable rate mortgage?
- Are you coming to the end of a fixed rate mortgage?
- Has your fixed rate mortgage ended but you have stayed with your mortgage lenders variable rate?
There are of course other ways to lower your mortgage payments. If you decide to extend the length of your mortgage, this will of course reduce the amount you pay every month for now. You will never know until you give it a go. We did, and it worked for us!