If you’ve left the United States to pursue a new life abroad, you might have given up your home and your job – but not your mortgage. You still owe money on that loan, after all. Keeping up with your mortgage payments should be one of your top financial priorities regardless of where you live. Here are some tips for paying down your US mortgage when you’ve moved abroad.
Letting your payment lapse can have serious consequences on your credit score and potentially cost you thousands of dollars in additional fees and accelerated repayment costs if you refinanced.
On that note, here are four tips for keeping up with your mortgage payments when you’ve relocated abroad.
Look for a Low-Interest Mortgage Deal
One of the fastest ways to pay down your US mortgage is by paying less and you can do this with a low-interest mortgage deal.
A low-interest mortgage offers you a loan with a lower interest rate on your home when compared to the regular interest rates. This often translates to making a larger down payment or higher monthly payments.
When looking for a low-interest mortgage a great way to get started is with a mortgage calculator. You use a mortgage calculator to get an estimate of your house payments giving you a better sense of what you can afford to pay.
In addition to your estimated house payments, your mortgage calculator also considers your principal, taxes, interest, and insurance.
The next step in finding a low-interest mortgage deal is to shop around for the best deals. Get your documents together and get quotes from the various lenders and banks within your area. This way you know what lender’s interest rates work best for you.
As stated earlier, making a larger down payment can secure you a low-interest mortgage deal. A larger down payment means you pay more upfront but the credit you will have taken is lower and easy to pay off with the right payment plans.
Consider Forward Contracts
With fluctuating exchange rates and unstable currencies, if you’re living abroad and maintaining a mortgage in the United States, setting up a forward contract with your exchange can help you save a lot of money.
A forward contract is a contract to buy or sell an asset at a future date. With a forward contract, you can lock in your rates for up to a year. This way you ensure that your monthly mortgage payments escape any foreign exchange fluctuations.
Find an exchange that offers this service and set up a forward contract to cover your mortgage payments.
Automate Your Payments
Different time zones and simply being halfway across the world make it easier to forget your mortgage payments. And missing payments or making late payments translates to late fees and can also negatively impact your credit score.
A great way to avoid this is to set up automatic recurring payments with your financial institution. You can communicate with your financial institution to set up a payment system that automatically debits your account to pay off your loan at a specified time each month.
It is also essential you keep your account funded so your financial institution can help you make your payments.
Find An Exchange With The Best Rates
One of the most complicated parts about living abroad and maintaining your mortgage is the exchange rates.
Your traditional financial institution might not be the best option, as their rates are often higher and less competitive.
You should keep your eye out for a private exchange that offers you the best rates ensuring you get the most out of your funds.
Furthermore, when getting your mortgage you can choose a lender that accepts crypto as a form of payment. Crypto takes out the red tape that surrounds foreign exchange making it easier for you to make payments from across the world.
With crypto, you can make your house payments directly to your lender without having to fuss over choosing the best exchange.