By: Jeremy Kates0 comments

So you want to lower your monthly payments? It sounds simple, but when it comes time to take action, the number of options and terms can make the process more complex than it needs to be.

We want to make it easier for you. For starters, you’re going to want to take a quick peek at your credit score. There are several places you can do this for free, but if you want the score that lenders are going to use (typically FICO), you will have to pay.

There are several more than those listed above, and you can also get a free copy of your credit reports at annualcreditreport.com from all three bureaus (available once a year).

There are often other ways to lower your payments that vary from lender to lender.

Automatic Withdrawals

Many lenders give discounts for setting up automatic withdrawal payments. This discount may come from lowered monthly payments or by cutting a dollar amount from your principal balance. Other lenders may give you a discount on your interest rate, which can really make a difference over the life of your loan.

If you do choose this route, it’s important to make a monthly reminder so that you make sure you the available funds before they debit your account. Most lenders will do this automatically after you set up the payment plan, but it’s a good idea to create your own as well.

Refinance and/or consolidate your Loans

If you have the means, it’s probably a good idea to at least explore refinancing your debt at lower rates. This can save thousands of dollars over the life of your loan, but you should make sure that you understand the implications of such a move.

 

 

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