June 5, 2020

Refinance Calculator for Mortgage – Should I Refinance my Mortgage

Refinancing is often worth it. It helps saves your money over the period of time of the loan. Using the calculator to estimate what the final savings will be with your new refinance mortgage loan calculator is easy. You have to keep in mind that the calculations are an estimate only, and that your monthly payment may be different from what is been shown on the calculator.

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What is Refinancing?

Refinancing a mortgage is getting a new loan on your home with the new terms .It can be generally done to either change the length of the particular loan or get a better beneficial lower interest rate.

Refinance Calculator Terms and Definitions

For an accurately estimate of your refinance savings, you will be needing some certain information about your current mortgage and your potential new one. Below are the information needed:

  • Interest Rate: The amount you are to pay for each year you borrow money from the lender or your lender. In order to make use of the refinance calculator, you will need both your current loan’s interest rate and that of expected new interest rate. If you aren’t sure about the rate of the new loan you carry, you can get an estimate.
  • Loan Term: this is to know how long your mortgage loan can last. The refinancing to a 30- year loan will be lower monthly payments the most. If your goal is to pay off your loan sooner you may want to get a shorter term loan.
  • Monthly Payment: This involves the only payments you have to make toward principal and the interest each month. If that of your monthly payment has to go toward an escrow (to cover the taxes and insurance), you should check with your mortgage lender to determine the exact portion that goes toward principal and the interest.
  • Current Loan Balance: This refers to the remaining principal balance on that of your recent mortgage loan. It can be found on your latest mortgage statement.
  • Estimates Closing Costs: You will have to pay the closing or the ending costs to the refinance your mortgage, just like the way you did it with that of the initial loan. It varies by the mortgage lender but it is usually come out around 2-5% of your total loan balance.

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Should I Refinance My Mortgage?

There are some certain questions to ask yourself whether you should refinance your mortgage. Below are the questions to ask:

  • How much equity do you have in your house?
  • What are your credit score?
  • How much long will you be in the home?
  • What is your Refinance goal?
  • What does your current loan does look like?

These are the questions you need to ask yourself, if you should refinance your mortgage.

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