Mortgage Refinance Calculator

With home mortgage refinance rates continuing to hover at record lows for many months now, you may be thinking that this is the perfect time to go for a home refinancing loan. Maybe you’re thinking that why would you have to pay a monthly amortization that can be lowered by taking advantage of the low mortgage refinance rate. However, this may or may not be the right time to refinance your home. In order to find out if you should do it or not, you can use a home mortgage refinance calculator that can be found in various home refinancing-related websites on the internet.

Since with home refinancing, you’ll be taking out a new larger loan to pay off your first loan, you need to make sure that you are refinancing for the right reason and at the right time, or else, the worst that could happen is you losing your home. Aside from the refinancing rate, you need to consider the additional costs that a home refinancing loan will incur. Home mortgage refinance calculators include this cost when calculating your new monthly payments, so that you can compare it with your current amortization. There are factors that you need to consider before deciding whether you should refinance or not.

In all home mortgage refinance calculators that you’ll find online, you will be asked to input the amount of your refinance fees. Some lenders will ask you to pay an application fee, loan origination fee, appraisal fee, inspection fee, and other fees that your lender may ask. These fees and charges vary from lender to lender, so you need to ask your lender about this. You may also have to pay points that are equivalent to 1% of your mortgage loan for every point. A loan-discount point is a one-time charge that you have to pay in order to lessen your interest rate.

When deciding whether you should refinance your home or not, you should consider your break-even point, a time when the refinance cost that you’ve paid is equal to the money you’ve saved because of the low mortgage refinance rate. Using a mortgage refinance calculator, if you’ve paid $2,000 in refinance cost and you’re saving $100 a month because of the lower refinance rate, your break even point is after 20 months or one year and 8 months. If you’re planning to stay in your home past that time, you can refinance your home mortgage even with the refinance cost you’ll pay.

Refinancing your home mortgage is a huge financial decision to make which will have a huge impact on you and your family’s future. Hence, you should make sure you’re doing it for the right reason, doing it properly, considering all related factors, and make sure you’re doing at the right time to do so. Taking advantage of low refinance rates shouldn’t be the only consideration when thinking of refinancing home mortgages. Utilize the mortgage refinance calculators found in various refinance websites to help you in your decision. Home mortgage refinance calculators are great tool that you can use for free.