Paying your mortgage on time is critical for increasing your home’s value, keeping interest costs low, and avoiding complications. Regularly making payments as they come due can also boost your credit score. This is the key to making your payments on time.
Your mortgage payment covers four parts – the principal amount, interest charges, property taxes, and sometimes insurance if your down payment was less than 20 percent of the house price. Each time you make a payment, it’s divided up accordingly.
Depending on what your lender accepts, there are different ways to pay your mortgage. Many provide several options, such as paying through the Internet or by phone. Since mortgages are due each month, it’s important to stay on top of them and choose the payment method that suits you best. Consult with a mortgage broker for assistance.
Let’s learn how to pay a home mortgage.
Pay Online
As with any other bill or loan, you can pay your mortgage online by signing in to your online banking. This is done on your lender’s website. It’s fast, free, and efficient, though you must manually do it every month. You decide when you can pay so long as it’s done by the due date.
Pay by Mobile App
If your mortgage lender has an app, paying through a mobile app is no different from paying online through a website. You may even be able to set a reminder for yourself through the app to send a push notification when your assigned payment date is approaching.
Pay by Automated Withdrawals
Many opt for pre-authorized chequing or savings account debits to pay their monthly mortgage. With this option, your lender automatically withdraws the mortgage payment on a specific day. It’s the easiest way to make a monthly mortgage payment, provided you have the funds.
Pay by Mail
While this is an option for few people take, some mortgage service providers accept payments by mail. For this, ensure that your account number appears on what you mail—be it a cheque, money order, certified cheque, etc. Make it clear that it’s a mortgage payment. Also, remember that a payment done by mail will take time to arrive and for your lender to process. This requires you to submit it before your payment date.
Pay by Credit Card
You may or may not be able to pay your mortgage with a credit card. Many lenders do not allow credit card payments for mortgages. They may charge a service fee that offsets any rewards or cashback you earn independently on your credit card. However, if you have no other option, this may be a way to arrange a payment, so you don’t miss it.
Pay by Phone
If you have trouble making your mortgage payment in a specific month, you can call in and submit your payment by phone. It will require having your mortgage number and banking info ready – including routing and account numbers. The advantage of paying over the phone is that it is processed instantly.
Pay In Person
If your lender is local, you should be able to present yourself at their front desk with a cheque or money order and make a mortgage payment this way. Depending on the type of lender, they may also accept cash, certified cheques, or a cashier’s cheque.
You Can Pay Extra Monthly
If you opt to make your mortgage payment manually and automated withdrawals do not do it, you can pay a little extra every month. There should be no penalties or fees for adding an extra every month. This amount will help you pay down your mortgage faster.
You Can Make An Extra Lump Sum Payment
If you receive a large sum of money, you can put it towards your mortgage. This may trigger a mortgage recast, lower your monthly payment, or result in penalties or fees. Be sure to check in with your lender about any costs incurred by making a lump sum payment on top of what’s been arranged for a payment schedule.
Late Mortgage Payment
If your mortgage payment is late, always contact your lender as soon as you know that’s the case. Explain the situation. See what they can offer. They may waive late fees. Be proactive with your lender to ensure your account remains in good standing.
Monthly or Bi-Weekly Payments
Monthly mortgage payments are once a week, while bi-weekly mortgage payments are paid every two weeks. Bi-weekly mortgage payments are more advantageous because, at the end of the calendar year, they amount to a total of 13 monthly payments compared to the 12 you’d pay if you’d gone with a monthly payment.
We hope you found this blog post How To Pay For A Home Mortgage useful. Be sure to check out our post on Reduce Friction In Your Mortgage Referral Process for more great tips!
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