May 13, 2006

Tips for Coping with Rising Mortgage Payments

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Tips for Coping with Rising Mortgage Payments

© Jeff Hoffman- All Rights reserved

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As interest rates drift upward, many home owners are faced with growing mortgage loan payments. Here are 4 excellent tips to help you cope with an increasing monthly payment

1) Think creatively on that home-equity line. Some borrowers are saving interest on a month-to-month basis by shuffling balances from their home-equity lines to credit cards offering zero-interest deals. This works, but only if the borrower is vigilant about reading the small print and shifting the money back at the right time.

2) If you've borrowed a lot on a home-equity line of credit, replace it with a fixed-rate second mortgage. You can lower your rate slightly, eliminate the chance that a rate rise will increase your costs, and set a fixed term so you're not paying for those home improvements forever.

3) Mortgage bankers who want customers back are offering home-equity credit lines with interest rates of prime plus zero or even below prime. They might get a borrower over the hump.

4) Borrowers who took out an option mortgage might consider using the option of making interest-only payments while they shop for a better loan. They won't be building equity, but they won't be hurting their credit score either. If you're buying a home and looking for a new loan, shop for a fixed-rate deal.

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Jeff Hoffman is the President of Hoffman Realty Group, Inc. and has assisted thousands of sellers and buyers during his real estate career. He is the creator of a powerful home selling system designed for the home seller not the real estate agent. To learn more about this amazing program visit Smart Seller Listing Home Marketing System

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