5 Ways to Lower Your Mortgage Payments in Oregon

October 24, 2017
Last updated:
March 9, 2022
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Adding another bill to the pile when you buy a home in Oregon can be very difficult, especially when you’ve got other bills to pay. In this article, we’ll provide a few handy tips to help you lower your mortgage payments.

Home prices in Oregon have increased, and that means the average mortgage payment for home buyers has also grown. As a result of this trend, many borrowers are looking for ways to reduce their mortgage payments.

Here are five strategies you could use to get a lower monthly mortgage payment in Oregon.

1. Make a bigger down payment.

There’s an inverse relationship between down payments and monthly mortgage payments. The more money you invest up front, the less you’re borrowing from the lender. This results in smaller monthly mortgage payments.

Putting more money down could also help you avoid mortgage insurance, and this too could help lower your monthly payments. It’s a trade-off. You would have to save more money for a larger down payment, but you’d wind up with a smaller loan and lower monthly payments as a result.

2. Buy a lower-priced home.

Some parts of Oregon are more expensive than others. The Portland housing market, in particular, is one of the most expensive in the state. But those buyers who are willing to live in one of the surrounding suburbs or cities could save a lot of money on their housing costs.

Try to be flexible and open-minded during your house-hunting process. A lower-priced home means a smaller mortgage and lower monthly payments over the long term.

Read: How much house can I afford?

Live Oregon Mortgage Rates

3. Extend the term of the loan.

The “standard” 30-year fixed-rate mortgage is by far the most popular financing option among home buyers in Oregon. Many people prefer this long-term mortgage product because it spreads the monthly payments over a longer period of time. This results in lower monthly mortgage payments for Oregon home buyers who use the 30-year option.

A shorter repayment term, on the other hand, will essentially compress your payments into a smaller window of time, thereby increasing the size of your monthly payments.

4. Use discount points to secure a lower rate.

Some home buyers in Oregon use discount points to get a lower rate, thereby lowering their monthly mortgage payments at the same time. This is another strategy worth considering.

In this context, one “point” equals 1% of the loan amount. It’s essentially a form of prepaid interest. You are paying more money upfront, at closing, in order to secure a lower rate and reduce your monthly mortgage payments. Here again, a trade-off is being made.

Related: A good time to buy in Oregon?

5. Refinance into a lower mortgage rate (for current homeowners).

If you are a current homeowner, and you took out your existing home loan years ago, you might be able to refinance into a lower mortgage rate. This is another common strategy for lowering the monthly mortgage payments on an Oregon home loan.

Thirty-year loan rates have remained below 4%, on average, so far in 2022, but they have bobbed up and down pver the past couple of months. As of March 2022, the rate for a 30-year fixed-rate mortgage is 3.76%. Economists from the Mortgage Bankers Association (MBA) have predicted that rates will likely reach the 4% mark by the end of the year. So, depending on your current rate and your equity situation, now might be a good time to refinance your home in Oregon.

You have a lot of options when it comes to choosing a mortgage loan, including the features of the loan. In many cases, borrowers who are willing to put more money down up front can secure a lower rate, and thereby reduce their monthly mortgage payments.

Other borrowers who have limited funds in the bank might take on a higher rate in exchange for reduced closing costs. There are many different ways to structure a home loan. The best scenario for you, as a borrower, is to choose a financing strategy that supports your goals.

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Have Mortgage Questions?

Do you have questions about how to get a lower mortgage payment in Oregon, or other financing-related topics? Sammamish Mortgage is a local mortgage company serving the entire state, as well as Washington, Idaho, and Colorado since 1992. We offer many mortgage programs to buyers all over the Pacific Northwest. Contact us today with any questions you have about mortgages.

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