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Paying Off Your Home Faster While Interest Rates are Low

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Taking Advantage of Low Interest Rates

When you make the decision to apply for a mortgage it is giving you the ability to partake in the largest investment that you will make in your lifetime. One of the most important things as a homeowner is ensuring that you make your payments to your mortgage so it can eventually be paid off and you will own your home in full. The best way to make sure that you put the most down on the principal balance is to pay attention to interest rates.

Look at Home Loan Markets

The first thing that you can do to make sure that you get the best interest rates is to stay on top of the home loan markets. When you are aware of the interest rates that are currently out there, you might have the ability to get a better rate. You can also take advantage of online home loan comparison calculators to help figure out how much you’ll be saving every month.

Fixed Rate Mortgages

Instead of choosing a variable mortgage, you can always opt for a fixed rate. In most cases you won’t find that your fixed rate will be substantially higher than the interest rates on variable mortgages. In most circumstances you can sign up for a fixed rate mortgage that is much lower than the average home loan interest rate, for example your interest may be 3.79% whereas the average can be around 4.74%.

Refinancing Your Home

If you find that you’re in a financial position where refinancing makes sense, you may want to consider talking to a financial advisor about switching the type of mortgage that you originally signed up for. As an example, if you find that you’re not happy with a fixed rate, you may want to consider signing up for a variable term. Many people find that a variable term gives them more flexibility but less assurance that their rates won’t skyrocket overnight.

Putting More on the Principal

The best way to make sure that you take advantage of low interest rates and pay your house off faster is to simply put more down on the principal balance of your mortgage. With each payment you will be able to cover the interest and then put an additional sum of money towards the total amount that you still owe to the lender that you chose.

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