The Comprehensive Guide to Our Mortgage Calculators (Part 3)
You’ve heard the buzz around refinancing, and maybe you wondered whether it might be right for you. Sure, people say that now is the time to refinance, but what about your specific case? This question can be difficult to answer, especially if you aren’t a mortgage expert. It doesn’t help that comparing a refinanced mortgage to your current mortgage often requires some complex math or maybe even a trip to talk to a lender.
At Local Mortgage in Colorado, we want to make the prospect of refinancing your mortgage as clear as possible for you. In parts one and two of The Comprehensive Guide to Our Mortgage Calculators, we showed you how to use our mortgage payment and renting vs. buying calculators to analyze your mortgage situation. Those two calculators are great for people looking to get into a new mortgage.
But what if you already have a mortgage? Well, our team at Local Mortgage has made a calculator for you too! In today’s blog, we will discuss how to get the most out of our refinancing calculator.
The Calculator for Current Homeowners
Like our other calculators, the main goal of the refinancing calculator is to give you clarity on your mortgage situation. In this case, the calculator is made to show you whether now is a good time for you to refinance your current mortgage. Therefore, the refinancing calculator is made with current homeowners in mind.
The purpose of this calculator is to clear up all the talk around refinancing and simply show you whether you could save money by refinancing your mortgage. Perhaps you are unsure what exactly refinancing is. If this is the case, then check out our blog covering the basics of refinancing.
At Local Mortgage, we hope to help you cut through any confusion and understand your current options. Refinancing could be great for you. We love helping our clients figure out if is right for them.
The Adjustable Details
All of our calculators feature various sliders, which allow you to adjust the details that go into calculations. These sliders can be changed either by typing numbers into the boxes or by dragging the box on the slider bar. This allows you to easily mold the calculator to represent your situation.
The refinancing calculator on our site can be used by adjusting these details:
Current loan amount - the remaining balance on your current mortgage
Current monthly payment - the amount you pay on your mortgage each month
Current interest rate - the interest rate associated with your current mortgage
New loan amount - the amount of money you will owe on your refinanced mortgage (this is typically the same as your current loan amount)
New interest rate - the new interest rate associated with your refinanced mortgage
Term of new loan - the number of years over which your refinanced mortgage is paid off
Closing costs - the costs associated with closing your loan
Finance closing costs - a yes or no selection of whether your closing costs can be added to your refinanced loan
By adjusting this information, you are able to use the calculator to compare the cost of your current loan to a refinanced mortgage. The calculator gives a fairly accurate comparison between those options. This tool is crucial to actually seeing how refinancing might improve your financial outlook.
The Information You Get
Once you update the sliders to match the loans you would like to compare, the refinancing calculator updates automatically to compare those loans. At the top of the calculator, you will see the amounts and the monthly payments of these two loans compared. Directly under this information, you can see how much you will save each month!
Our calculator generates a graph so you can visually compare the refinanced mortgage to your current mortgage. The graph shows the principal paid over the life of each loan in navy blue and the interest paid on each loan in a lighter blue. The heights of these bars together show the cost of each loan.
The refinancing calculator is also designed to tell how long it would take you to recover closing costs with the savings from refinancing. This information can be found above the graph. Although refinancing might cost you a little money at first, many people recoup that cost quickly and even save money in the long run.
By analyzing all of the information our refinancing calculator generates, you can get a better idea of how refinancing might affect your financial outlook. This is obviously a powerful tool for you to use. If you think refinancing could decrease your monthly payments, then this is the place to begin!
At Local Mortgage, we try to give you all the tools to take control of your financial future. Whether that means giving you a calculator to see how refinancing could help you or helping you secure a mortgage, we hope to be with you every step of the way. Feel free to use our refinancing calculator to see what works best for you.
We believe that with this guide, you are now ready to make the most out of our refinancing calculator. Try it for yourself to see the difference historically-low interest rates can make.
This post concludes our guide to the mortgage calculators on our site. If you have used our calculators and feel ready to apply for a mortgage, then we can help! The team of experts at Local Mortgage is ready to assist you with all of your mortgage needs.