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Homeowners are still waiting for mortgage relief. Despite mounting expectations for Federal Reserve rate cuts, monthly payments remain high for millions of borrowers locked into rates near or above 7%. With household budgets already stretched thin, that hefty housing payment continues to crowd out other financial priorities.
The wait for lower rates could drag on for months, but mortgage professionals say you have options right now. Whether you’re struggling to make ends meet or simply want more financial breathing room, several strategies can slice hundreds of dollars off your monthly housing bill this fall. Below, we’ll break down a few expert-back recommendations to explore now.
Start by seeing how low today’s current mortgage rates are here.
How to lower your mortgage payment this fall, according to experts
Below, experts break down three ways to lower your mortgage payment this fall — and explain when each strategy makes sense:
Refinance to a lower rate
Refinancing requires securing a new loan to replace your existing mortgage, typically to get a better mortgage interest rate or terms. It takes 45 to 60 days, and works best when you can secure a rate at least 0.75% to 1% lower than your current one to justify the costs.
According to Steven Glick, director of mortgage sales at real estate investment fintech company HomeAbroad, today’s rates around 6.5% to 6.6% could deliver meaningful savings if you locked in a rate above 7%.Â
But closing expenses can range from 2% to 6% of what you’re borrowing. So, calculate your breakeven point first. For example, Glick’s client refinanced to 6.7%, saving $163 a month. But with $5,000 in closing costs, the breakeven stretched to 31 months.
Eligibility also depends on your loan type:
- FHA loans: “If you have an existing FHA loan, you may qualify for a Streamline Refinance,” explains Debbie Calixto, sales manager at mortgage lender loanDepot. “The requirements are minimal: your loan must meet a waiting period, your home must be your primary residence, your payments must be current and the refinance should lower your interest rate by at least 0.5%.”
- VA loans: “If you have a VA loan and live in your home, you may be eligible for a VA Interest Rate Reduction Refinance Loan (IRRRL),” Calixto says. These offer streamlined options with no appraisal or income verification required.
- Conventional loans: You’ll need a credit score of 620 or higher, steady income and ideally 20% equity to avoid private mortgage insurance.
Explore your current mortgage rate options here to determine if a refi makes sense for you this fall.
Apply for a mortgage recast
“A mortgage recast is less well-known but can be a great tool,” Calixto points out. This strategy allows you to make a large payment toward what you owe. Your lender then calculates a new monthly payment based on your reduced balance. Your loan term stays the same, but you’ll pay less each month. You’ll typically need the following to qualify:
- A conventional or jumbo loan (FHA and VA loans don’t usually qualify)
- A minimum lump sum of $5,000 to $10,000
- A clean payment history
Catherine Barnett, mortgage broker at LoanFit, notes that many lenders don’t provide recasting, though mortgage brokers often have access to investors who do.
The process is quicker and more affordable than a refi. It takes approximately 30 days and costs $150 to $500 with no credit verification needed. The trade-off is that it won’t lower your interest rate. So, if market rates have dropped substantially, refinancing might save more long-term.
Barnett has seen cases where applying $50,000 toward a mortgage drops monthly payments by roughly $325. Recasting is ideal for borrowers with already-low rates who want immediate relief and who have a substantial amount of money to the side to apply.
Seek a loan modification
A loan modification involves your servicer adjusting the initial loan terms with the aim of making payments less expensive during a financial hardship. This happens in a variety of ways, from reducing your interest rate, extending your loan term or temporarily pausing part of your payment. You’ll need to qualify based on genuine hardship and will need to be prepared to provide the following documentation:
- Pay stubs
- Tax returns
- Current loan statements
- Proof of hardship (e.g., layoff notice, medical bills)
- A hardship letter explaining your issue and recovery plan
Glick highlights that lenders look for borrowers who are at risk of default or already behind on payments. Modifications aim for a 20% to 30% payment reduction, but the process takes 60 to 90 days and may negatively impact your credit if you’re already delinquent. The potential savings are tied to your current mortgage balance, existing term and any modifications that your servicer approves.
The bottom line
Each of these strategies can provide relief, but timing and preparation are key. Keep in mind that processing times can range from 30 to 90 days, so factor this into your planning. Starting before the holidays is a good way to avoid delays that can stretch these timelines by weeks.
When speaking with lenders, come prepared with your financial documents and be clear about your goal — whether that’s lowering payments, avoiding foreclosure or freeing up cash flow. If you’re feeling overwhelmed, reach out to a HUD-approved housing counselor for free guidance first. They can help you choose the right approach and navigate lender conversations effectively.
