If you are asking yourself why would you ever need a mortgage calculator, then you are probably very good in math and calculations, and especially good in doing financial calculations, as that’s what the mortgage calculator serves for.
As a responsible manager of your personal or your family’s finances, you’re obliged to manage them in a way so you get the most for your money and save something at the same time. And that’s mainly why you should use mortgage calculator; to help you calculate exactly what you should do with your money. Here are a few ways you can use mortgage calculator.
Calculate the Monthly Payments on a New Mortgage
As the name says it, it is a mortgage calculator, hence why the most common way of use is calculating the monthly payment on your mortgage. Whether you get it for buying a new house, or for refinancing an old mortgage, a mortgage calculator will calculate all the mortgage calculations that are hard and time-consuming, before you can blink. Moreover, it can easily compare all your loan options by putting all the relevant information and factors at the tip of your fingers, making otherwise scary financial decisions, a real breeze.
Calculate Your Mortgage Early Pay Off
If you got a mortgage with the term of 30 years or so, you should know that by the time this term is over, as a typical mortgage holder you would have made total interest payments much larger than the original principal on the loan. Use mortgage calculator to find out how you can shorten this term and save a lot by adding some extra money towards the loan’s principal each month, year or just one time.
Deciding If an ARM is Worth the Risk
An ARM is short for adjustable-rate mortgage and comes with a lower initial interest rate, which is very tempting. Although some users of this arrangement will find their monthly payments significantly cut, others may not benefit this much. So, to see where you stand with the ARM arrangement, use mortgage calculator and make a comparison of what would you pay with the ARM versus the amount you’d pay for a conventional 30-year fixed mortgage.
Know When Your Private Mortgage Insurance Is No Longer Needed
The general rule is: once you reach 20% equity in your home, you can request from your lender to wave private mortgage insurance requirement. To know when will you reach this threshold, use mortgage calculator and calculate it. First calculate your amortization table. Next you should multiply your original mortgage amount by 0.8 and compare this result with the closest number on the far-right column in the amortization table to see when will you get to the 20% threshold.