Your mortgage is likely your biggest monthly expense. With the average 30-year fixed mortgage rate at 5.99% as of November 2025, even small adjustments can save money on mortgage and translate into thousands of dollars in savings. Here are seven practical strategies to save money on mortgage payments without refinancing or making drastic lifestyle changes.
1. Shop Around and Compare Lenders Aggressively
The savings potential: Shopping around for mortgage rates can save you nearly $44,000 over the life of your loan.
Most homebuyers make a costly mistake; they compare only two or three lenders. Research from Realtor.com analyzing 2 million borrowers found that comparing multiple lenders yields mortgage rates 0.55% lower than average. On a $425,000 home with a 20% down payment, that small percentage difference compounds dramatically over 30 years.
Action step: Get quotes from at least 5-7 different lenders, including online lenders, traditional banks, and credit unions. Focus on the Annual Percentage Rate (APR), not just the interest rate, as it includes fees and closing costs.
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2. Make Biweekly Payments Instead of Monthly
The savings potential: Eliminate 4-7 years from your mortgage and save thousands in interest.
Switching to biweekly payments is one of the simplest ways to save money on mortgage costs. Instead of making 12 monthly payments annually, you’ll make 26 half-payments (equivalent to 13 full payments). That extra payment goes directly to your principal, reducing the interest you owe.
How it works: If your monthly payment is $1,500, pay $750 every two weeks. Alternatively, divide your monthly payment by 12 and add that amount each month, so you’d pay $1,625 monthly instead.
Real example: On a $300,000 mortgage at 6.5% interest, biweekly payments could shave off approximately 5 years and save you over $50,000 in interest.
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3. Eliminate PMI as Soon as Possible
The savings potential: $30 to $70 per $100,000 borrowed, monthly.
Private Mortgage Insurance (PMI) protects your lender, not you. If you put down less than 20%, you’re likely paying PMI, an expense that can add hundreds to your monthly payment.
Three ways to remove PMI:
Request cancellation at 80% loan-to-value ratio: Once you’ve paid down your mortgage to 80% of your home’s original value, you can request PMI removal in writing. You must be current on payments with a good payment history.
Wait for automatic termination at 78%: Lenders must automatically cancel PMI when your balance reaches 78% of the original home value.
Get a new appraisal: If your home has appreciated significantly or you’ve made substantial improvements, pay for a professional appraisal (typically $300-$500). If you’ve owned the home for at least two years and your loan balance is 75% or less of the new appraised value, you can request PMI cancellation.
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4. Buy Discount Points Strategically
The savings potential: $50-$200 monthly, depending on loan amount.
Mortgage points let you “buy down” your interest rate upfront and help you save money on mortgage. One point typically costs 1% of your loan amount and reduces your rate by approximately 0.25%.
When it makes sense: Calculate your break-even point. For example, on a $300,000 loan, one point costs $3,000. If it reduces your monthly payment by $50, you’ll break even in 60 months (5 years). Buy points only if you plan to stay in your home longer than the break-even period.
Current market advantage: With rates hovering around 6% in late 2025, buying points to lock in a lower rate could yield significant long-term savings if rates rise again.
5. Consider Mortgage Recasting Over Refinancing
The savings potential: Lower monthly payments for approximately $250-$500 in fees.
Mortgage recasting is an underutilized strategy to save money on mortgage payments. If you’ve received a windfall, inheritance, bonus, or investment proceeds, you can make a lump-sum payment toward your principal and have your lender recalculate your monthly payment based on the remaining balance.
How it differs from refinancing:
- Keeps your existing interest rate and loan term
- Costs only $250-$500 versus $3,000-$6,000 for refinancing
- No credit check or appraisal required
- Processing takes weeks, not months
Example: You have a $200,000 mortgage with 20 years remaining. After a $40,000 lump payment, your balance drops to $160,000. Your lender recalculates your payment based on $160,000 over the remaining 20 years, immediately lowering your monthly obligation.
Limitation: Most lenders require a minimum lump payment of $5,000-$10,000 and allow recasting only once or twice.
6. Appeal Your Property Tax Assessment
The savings potential: Average annual savings of $539, with 40-60% success rates.
Property taxes are typically included in your monthly mortgage payment through an escrow account. Lowering your property tax directly reduces your monthly housing costs.
The opportunity: Between 30% and 60% of taxable properties in the U.S. are over-assessed. Over 40% of American homeowners could save $100+ annually by appealing their assessment. In commercial properties, successful appeals achieve 10-15% reductions in assessed value.
How to appeal:
- Verify your assessment details for errors in square footage, number of bedrooms/bathrooms, or property condition
- Research comparable sales in your neighborhood, find 3-5 similar homes that sold for less
- File within the deadline, typically 30-45 days from receiving your assessment notice
- Present evidence such as contractor invoices showing an old roof if your assessment claims it’s new
The process is “reasonably easy and fair” according to the National Taxpayers Union Foundation, and the adjustment typically applies for multiple years, compounding your savings.
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7. Bundle Insurance and Maximize Homeowners Discounts
The savings potential: 15-25% off homeowners insurance premiums.
Your homeowners insurance, like property taxes, is usually paid through your mortgage escrow account. Reducing insurance costs directly lowers your monthly mortgage payment.
Top discount strategies:
- Multi-policy bundling: Combining home and auto insurance with the same company saves up to 24.2%. State Farm offers 25% discounts for bundling.
- Loss-free discount: Three consecutive years without filing a claim can earn you up to 16.4% off.
- Security and safety upgrades: Installing fire extinguishers, smoke alarms, deadbolts, or burglar alarms saves 2-8.5%. Modern water leak detection systems with automatic shut-off also qualify for discounts.
- New home discount: If your home was built within the last 10 years, you may qualify for additional savings.
- Annual review: Insurance rates fluctuate. Shop around every 2-3 years to ensure you’re getting the best rate, loyalty doesn’t always pay in insurance.
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Making Your Mortgage Work Harder for You
The path to save money on mortgage payments doesn’t require dramatic lifestyle changes or complex financial maneuvers. By implementing even two or three of these strategies, you can reduce your monthly obligation by hundreds of dollars and save tens of thousands over your loan’s lifetime.
Start with the easiest wins: shop for better insurance rates, verify your property tax assessment for errors, and switch to biweekly payments. Then evaluate whether buying points, eliminating PMI, or recasting makes sense for your specific situation.
With mortgage rates showing signs of stabilization and the Federal Reserve likely to continue gradual rate adjustments, now is the optimal time to optimize your mortgage strategy. Every dollar you save compounds year after year, building equity faster and freeing up cash flow for other financial goals.
The average American pays over $2,000 monthly on their mortgage. Using these seven strategies, you could reduce that figure by $200-$400 monthly, that’s $2,400-$4,800 annually that stays in your pocket instead of going to lenders, insurers, or tax collectors. Your future self will thank you for taking action today.
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Q1. How much can I really save on my mortgage using these strategies?
You can save anywhere from $20,000–$70,000+ over your loan lifetime depending on loan size, rate, and how many strategies you use.
Q2. Is refinancing required to reduce monthly mortgage payments?
No, methods like bi-weekly payments, PMI removal, recasting, and tax appeals work without refinancing.
Q3. Do bi-weekly payments really cut years off a mortgage?
Yes. Switching to bi-weekly payments can reduce 4–7 years and save $30,000–$60,000+ in total interest.
Q4. How soon can I remove PMI?
You can request PMI removal once you reach 80% loan-to-value, or wait for automatic removal at 78%.
Q5. Is mortgage recasting better than refinancing?
For homeowners who already have a good rate, recasting is cheaper – $250–$500 vs. $3,000–$6,000 for refinancing.
Q6. How much can appealing my property tax save me?
Successful appeals save an average $539/year, with 40–60% approval rates in many counties.
Q7. How much can insurance bundling reduce monthly payments?
Bundling home + auto can reduce premiums by 15%–25%, directly lowering your escrow contribution.
