An estimated 13.4 million Americans — or 6.2% of all U.S. adults — are not current on their rent or mortgage payment, according to the U.S. Census Bureau’s latest Household Pulse Survey.
Among those in nonpayment are individuals who have slight or no confidence in making their next payment on time, and a third (32.9%) report that eviction or foreclosure in the next two months is likely. And to make matters worse, 12.3% of all U.S. adults expect someone in their household to experience a loss in employment income sometime in the next month, the survey found.
If you’re unable to make your monthly housing payment due to financial hardship, you have options. Refinancing your mortgage or other consumer debts while interest rates are low can help you lower your monthly expenses so you can get back on track with your budget.
For homeowners: Refinance your mortgage to lower your monthly payments
Your home is likely the most expensive thing you own. The average individual’s mortgage debt was $208,185 in 2020, according to data from Experian. It’s no surprise that a mortgage payment is one of the largest monthly expenses for most homeowners. During times of financial hardship, it can be difficult to pay any expense, especially something as large as a mortgage payment.
Fortunately, you may be able to save hundreds on your monthly mortgage payment by refinancing to a lower interest rate. Mortgage refinance rates are holding steady near record lows, which makes it a great time to refinance your mortgage and save money.
You could also consider refinancing to a longer-term mortgage, which will further spread out the total cost of your loan and lower your monthly payment even more. Keep in mind that a longer mortgage term may increase your total cost of borrowing.
Use a mortgage calculator to find out how much you can save on your monthly payment based on your loan amount, loan length and estimated interest rate. To see what kind of mortgage rates you may qualify for without affecting your credit score, get prequalified on Credible’s online marketplace.
For renters and homeowners: Consider refinancing other debts
Mortgage refinancing is a reliable way to lower your monthly housing payment but this option isn’t available to renters. However, whether you own your home or rent, you may be able to refinance other debts to make it easier to afford your monthly housing payment.
You can potentially save on your monthly loan repayment by refinancing your…