How to Lower Your Mortgage Payment in 2025: 15 Proven Strategies

With rates and housing costs changing fast, there are still multiple ways to reduce your monthly mortgage payment in 2025 — even if you bought recently. Use this step-by-step playbook to save money immediately and over the life of your loan.

15 Strategies That Work in 2025

1. Refinance to a lower rate when market rates drop or your credit improves.
2. Extend your loan term (e.g., 30 → 40-year options in specific programs).
3. Remove PMI at or above 20% equity; request a new appraisal if values jumped.
4. Appeal property taxes using comparable sales and valuation errors.
5. Shop homeowners insurance and increase deductibles responsibly.
6. Claim all eligible discounts (security system, bundle auto+home).
7. Make a one-time principal payment to reduce interest costs and PMI timeline.
8. Biweekly payments can reduce interest paid over time (verify servicer policy).
9. Eliminate escrow shortages with a lump sum vs spreading over 12 months.
10. Consider ARM to fixed when rate environment stabilizes at lower levels.
11. Loan modification for hardship — request lender options.
12. Apply for homestead exemptions where available to reduce assessed taxes.
13. Energy upgrades that lower insurance and utility costs (EEMs).
14. Debt payoff to improve DTI and refinance into better terms later.
15. Shop multiple lenders and ask for pricing exceptions and fee waivers.

Frequently Asked Questions

Can I remove PMI without refinancing?

Yes. If you reach 80% LTV based on current value, you can request PMI removal with your servicer after a new appraisal.

Is refinancing worth it if rates are only slightly lower?

Run the breakeven: total costs divided by monthly savings. If you recoup in 24–36 months and plan to keep the home, it often makes sense.