Owning a house is expensive, no matter where you live, how big your house is, or your salary. The cost of homeownership has only continued to grow throughout the years to the point where many Americans fear they may not be able to afford to buy a house, or that they may default on their mortgage if they were to buy a home. But the truth is that homeownership is a great move for your financial health if you know the right ways to make your mortgage work for you. Here are three tricks that you can use to reduce your mortgage payment and make homeownership more affordable.

Refinance

The first trick that you should consider using to reduce your mortgage payment is to refinance your home loan. When you first take out your loan, the interest rates offered to you may be higher than interest rates in a few years. If you can refinance your mortgage to a loan that is even just a few tenths of a percent smaller interest rate, you can save thousands of dollars over the long run of your mortgage. Don’t be afraid to shop around to other lenders and see if refinancing your home could help you take on a smaller mortgage payment.

House Hack

Another trick that you can use to reduce your mortgage payment is a home buying strategy called house hacking. House hacking is where you purchase a multi-unit property, live in one unit, and use the rent from the other units to cover mortgage costs. This can be a great way for anyone to get started in homeownership, as it can even lead to a zero-cost housing situation for you. House hacking does come with the added responsibility of being a landlord, however. Taking care of the property creates better relationships with tenants. Make sure you do your best to keep your tenants happy if you house hack.

Put More Money Down

The final trick that you can use to decrease your mortgage payment is to put more money down on the house when you purchase. When you take out a mortgage, you pay interest on all of the money loaned. The more money you put down, the less money you need to take out via a mortgage loan. This can lead to significantly decreased mortgage payments. If you can pay 20% down on a home, that tends to be the sweet spot. There’s no required amount to put down, but 20% is a good goal to shoot for.

Mortgage payments can be huge if you don’t know what you’re doing. But luckily there are many tricks to help you decrease your payments. Try using these three tricks and you are on your way to smaller, more manageable mortgage payments instantly.

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