10 tips to save money on your mortgage

Here are 10 tips to help you save money on your mortgage and keep your payments manageable - grab a pen, paper and get started!

A mortgage is a big investment, we all agree, and it can be difficult to maintain if you are not careful.

1. Make a budget: Great value! Before you start looking at your future home, it's important to budget and work out how much you can realistically afford to spend on your mortgage payment each month. There's no point falling in love with a house that's out of your price range - you'll end up frustrated and disappointed (and heartbroken). Once you have a budget, stick to it!

2. Get pre-approved for a loan: Getting pre-approved for a loan is a great way to stay within your budget. When you get pre-approved, the lender will tell you how much money you can borrow. This will give you an idea of what kind of home you can afford and help you narrow down your search.

3. Research the interest rate: Interest rates can vary widely from bank to bank, so it is worth comparing rates before making any decisions. Bear in mind that the interest rate is not the only factor to take into account: make sure you also compare the fees and the conditions (home insurance, life insurance, pension plans, etc.).

4. Make a big down payment: The more money you put down, the lower the monthly payments will be. If you can afford it, try to make a down payment of 20% or more.

5. Get rid of debts: If you have any outstanding debt, it's time to pay it off! The less debt you have, the higher your credit score, and the higher your credit score, the lower your interest rate.

6. Consider whether a fixed, variable or mixed rate mortgage is more suitable for you: Variable-rate mortgages usually start with lower interest rates than fixed-rate mortgages, but they can go up over time, so it is important to understand how they work before choosing this type of mortgage. We advise you to inform yourself carefully before choosing, as well as to be informed of the forecasts for the evolution of the reference rates. Variable mortgages can be a good option if you plan to sell your home before interest rates rise or if you know you can afford higher payments in the future. Fixed mortgages are the best option if you want to keep your repayment untouchable for the life of the loan. Also, as time goes on, what initially seems like a higher instalment will undoubtedly be seen as lower, because of the impact of the CPI on the value of money.

7. Refinance when rates are low: If interest rates drop after you get your mortgage, don't be afraid to refinance! Refinancing could help you lower your monthly payments or shorten the term of your loan, which could save you money in the long run. Also, under current mortgage law, taxes and other mortgage origination fees are paid by the bank. So don't be afraid to switch banks, as you can save a bundle!

8. Engage the services of a mortgage broker: We know that the word "broker" sounds terrible, but nowadays mortgage financial advisors (it sounds nicer, doesn't it?) have much better conditions than what bank branches can offer their clients. It sounds paradoxical, but that's how it is. Brokers will submit your profile to all the entities they work with and they will surely find the entity with which your profile is perceived as suitable, or is at a time when it is in their interest to "sell" more mortgages to meet the year's targets. So the money that the broker (who obviously does not work for free) will cost you will be more than compensated by the savings you will get in the interest rate, commissions and the links.

9. Make extra principal payments whenever possible: Every little bit helps when it comes to paying off the mortgage. If you have some extra cash on hand (perhaps from a bonus at work or some unexpected income) instead of going on holiday to an island paradise, consider making an extra payment towards the principal balance of your loan: this will help reduce the amount of interest that accrues over time and could cut years off your repayment term. This is especially relevant during the early years of the mortgage, when you are paying most of the interest on the loan.

10. Maintain discipline: It can be easy to fall behind on mortgage payments if life gets complicated or unexpected expenses arise, but it's important to be disciplined and keep up with regular payments. Missing payments will negatively impact your credit score and put you at risk of foreclosure. If you have a severe financial setback, ask your bank to help you refinance your debt, either by extending the term of the loan or by taking a temporary grace period. Think that your bank will be more interested in helping you than having to take you to court.

Ultimately, acquiring a mortgage is a big financial commitment, but with careful planning and discipline, you'll be turning a loan into an excellent real estate investment vehicle: use these tips as a guide to help keep your payments in line and save money over time.