Refinance calculators consolidating loans

23-Aug-2016 20:38 by 2 Comments

Refinance calculators consolidating loans

For background, read Pros and Cons of Debt Consolidation.

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The first three calculators are directed to this question, and apply to FRMs only.

Not only will this calculator calculate the monthly payment and net interest savings (if applicable), but it will also calculate how many months it will take to break even on the closing costs (if applicable).

Most borrowers contemplating a refinance want to know whether the financial gain from a lower interest rate more than offsets the refinance costs.

Borrowers with an adjustable rate mortgage concerned about rising interest rates want to know the size of the risk and the cost of eliminating it by refinancing into an FRM. (3e) Assumes the borrower has an ARM first mortgage which might be refinanced into an FRM first mortgage.

The issues are explored in two articles: Is Now the Time to Refinance an ARM Into a FRM? Borrowers who can’t take advantage of lower interest rates because their house value has depreciated want to know whether paying down the balance on their existing FRM in order to lower the cost of refinancing into another FRM would yield a satisfactory rate of return.

You may be able to use this equity to refinance your current mortgage and receive cash at a low interest rate to pay off your credit card debt.

Home equity is the appraised value of your home minus the amount you still owe on your loan.

The recommended article is Is Cash-in Refinancing For You? (3f) Assumes the borrower has an FRM first mortgage but not enough equity to make refinance worthwhile unless the loan balance is paid down.

Borrowers who are burdened with short-term debt may want to know whether it pays to consolidate such debt in a cash-out refinance.

(1c) Assumes the borrower has two mortgages plus other debt which can be consolidated with a cash-out refinance or a new second mortgage.

The average credit card interest rate is around 15%.

Some states have limits on how soon or how often their residents can refinance a home loan; these limits are often designed to ensure that the refinance process benefits the homeowner.