Changing Monthly Mortgage Payments


by Martin Lukac - Date: 2006-12-19 - Word Count: 427 Share This!

The amount of money that you pay each month for your mortgage payments will change over the life of your loan. This could be for any number of reasons. For instance they could go up or down due to taxes, whether or not you have an adjustable or fixed rate mortgage, your insurance premiums and perhaps due to some other miscellaneous fees.

The vat majority of escrow analyses are done not at the beginning of the year but at the end of it. This is when you will see taxes getting higher and your insurance premiums going up. When these go up so does your monthly payment for the next year. So if you are smart you will start learning how to save some money so that when the next year does come you will have some cash to put towards these new price increases.

If you have an adjustable rate mortgage you are at risk even more than those with a fixed rate mortgage. With an Arm your cost can change even more because when the market changes so will your mortgage payment. Those with these types of mortgages can end up paying astronomical sums in interest.

As soon as you get approved for an adjustable rate mortgage it is a good idea to start saving some extra money each month in a reserve fund. Save this money for the times when the interest does rise. This fund could mean the different between being able to meet your monthly payments and not being able to meet it.

Some adjustable rate mortgages will even have ways for you to pay in advance. These types of prepayments can go a long way towards easing your monthly payments. These payments are generally reassessed each year and you can also prepay each year. You can do this each year during the 45 days before your next adjustment.

If it is a fixed rate mortgage that you have as opposed to an adjustable rate mortgage then your monthly payments will not be as volatile but they still can change from time to time. You can still prepay but this will not change your monthly payments at all, it will just help you to pay off the principle balance that much sooner.

If you want to lower your monthly payments and you have a fixed rate mortgage you can see if you can stop paying for mortgage insurance. Once you have built up a certain amount of equity in your home then this should not pose a problem and it could save you thousands of dollars each year.


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Martin Lukac http://www.MartinLukac.com , represents http://www.RateEmpire.com , an Internet consumer banking marketplace. RateEmpire.com is a destination site of personal finance, investing, taxes and mortgage rates. RateEmpire.com provides mortgage guides and financial rates and information. RateEmpire.com also operates a financial portal #1 American Financial, found at http://www.1AmericanFinancial.com

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