Using Mortgage Calculators to Determine Refinancing Options

By Karen Lawson
Loan Page Columnist

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If you're thinking about home mortgage refinancing, you have plenty of options. Depending on your reasons for refinancing, there are tools available to help you decide which loan product best meets your needs. You can use a mortgage calculator to find basic information about interest rates, savings, and payment amounts.

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What is a Mortgage Calculator, and Where Do I Find One?

Mortgage calculators are widely available online. You can find them on lender websites, and mortgage industry websites such as those owned by Fannie Mae and Freddie Mac. It's not necessary to buy an expensive financial calculator, or know how to use one. Mortgage calculator programs are easy to use. All you have to do is enter the required information and wait for your answer. Depending on which mortgage calculator you're using, you'll need to have certain information handy, such as:
  • » The unpaid balance (amount you owe) on your current mortgage
  • » The amount of your potential refinance
  • » Interest rates of your present mortgage, and of your refinance loan
  • » Your monthly income and expenses
  • » How long you plan to stay in your home

Mortgage Calculators Help Answer Important Questions

You don't need a fortune teller to find out how your future mortgage refinance will work. Mortgage calculators are designed to answer basic questions for borrowers shopping for home loans as well as those seeking refinancing. Here are examples of questions that can be answered by using a mortgage calculator:
  • » How much can I afford to borrow?
  • » How much will my monthly payment be?
  • » I have a specific payment amount in mind. How much will I be able to borrow?
  • » Is now a good time to refinance?

Of course, lending professionals and your financial advisor can assist you with more specific advice, but mortgage calculators are a great resource when you're shopping for home mortgage refinancing options.

Source
Fannie Mae Website

About the Author
Karen Lawson is a freelance writer who has more than fifteen years of experience in mortgage banking. She earned an MA in English from the University of Nevada, Reno.

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