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  • Writer's pictureColin Dubel

The Best Ways to Reduce your Mortgage Payment

There are several ways a commercial real estate owner can potentially reduce their mortgage payment on their property loan. Here are some possible strategies:

  1. Refinance: Refinancing the loan can be a good option if interest rates have dropped or if the property value has increased since the original loan was taken out. This could result in a lower interest rate and monthly payment.

  2. Extend the Loan Term: By extending the loan term, the borrower can reduce their monthly mortgage payment. However, this may result in paying more interest over the life of the loan.

  3. Negotiate with the Lender: If the borrower is experiencing financial hardship, they may be able to negotiate with the lender for a lower interest rate or reduced payment for a period of time.

  4. Increase the Down Payment: A larger down payment at the time of purchase or refinance could result in a lower loan amount and monthly payment.

  5. Improve the Property: Making improvements to the property can increase its value and potentially lower the interest rate or increase the loan-to-value ratio, which could lead to a lower monthly payment.

  6. Consider an Interest-Only Loan: An interest-only loan allows the borrower to pay only the interest portion of the mortgage payment for a set period of time, typically five to ten years. This can result in a lower monthly payment during the interest-only period. However, it's important to note that the principal will still need to be paid off eventually, and the monthly payment will increase significantly once the interest-only period ends.

  7. Make Extra Payments: Making extra payments towards the principal balance of the loan can help to reduce the overall amount owed and potentially lower the monthly payment. Even small additional payments made consistently over time can add up and result in significant savings over the life of the loan.

  8. Explore Government Programs: There are a number of government programs that may be available to commercial real estate owners who are struggling to make their mortgage payments. For example, the Small Business Administration (SBA) offers loan programs that may provide financial assistance to eligible businesses. It's worth researching what options may be available and speaking with a financial advisor or government representative for guidance.

Ultimately, the best way for a commercial real estate owner to reduce their mortgage payment will depend on their individual financial situation, the terms of their loan, and their long-term goals for the property. It's important to carefully evaluate all options and seek professional advice before making any decisions that could impact their financial future.


If you have any questions about this article or would like to discuss a scenario of your own with our team, please feel free to contact Colin Dubel at colin@harborwestcommercial.com or 949-735-6415.

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