There are a variety of free mortgage calculators available on the Internet. These can be useful for determining how much home you can afford, whether to buy a home or continue renting, and what your monthly payment will be. Here are descriptions of a few different calculators.
How Much Loan Can You Get
Before you go house searching you may want to know how expensive of a home you can afford. An affordability calculator will take a look at your income, all your debts (auto loans, credit card debt, etc), taxes and insurance for the new property, and information about the loan itself to determine the maximum loan amount you might be able to obtain.
Monthly Payment
Your monthly mortgage payment is made up of a variety of costs, including principal, interest, taxes and insurance. A payment calculator considers all these and gives you your actual monthly payment. This is an important figure to know when determining whether or not you can afford a loan. Remember that even if you're able to obtain a loan, you still have to make the monthly payment.
Keep Renting or Buy a Home?
A 'rent or buy' calculator helps you see how much more money you might gain or lose by buying a home as opposed to renting. A key element to consider in this calculation is the time period looked at. For instance, if you were to rent a home for five years, you'd save $80,000 in monthly payments compared to if you were to buy a home. However, if you were to buy a home, when you sold it, you'd make that money back plus an extra $5,000. This calculator can help you see all this so that you can make the best decision about whether to rent or buy.
To Refinance or Not to Refinance?
If you currently own your own home, you may wonder whether or not it would be beneficial to refinance. There is a calculator for this too. One of the factors to include when considering whether to refinance or buy is how soon you'll sell your home. For example, if you plan to sell your home in five years, you might end up saving $1,500. However, if you were to sell it in ten years, your savings could be $4,000, while if it sold in 25 years, you would lose $7,500.
Good, Better, Best
Mortgage lenders offer a variety of loan products that you can choose from, but how do you know which one is best? A loan comparison calculator allows you to enter in key values such as the interest rates, points, and closing costs. The calculator will then show multiple elements of comparison. Key among these are the monthly payments and the total savings over the life of the loan. Such a calculator can help you know which loan to choose. Be careful though, because different loans can have different amounts of mortgage insurance associated with them, and the calculator might not take that into account.
Bi-Weekly Payments
Want to know if paying off your mortgage every two weeks will actually help you save money over paying once a month? There's a calculator for this too. It can show you how much quicker you'll pay off the loan and how much you'll save in interest. Because you won't pay as much in interest by paying every two weeks, you could lose out on some tax benefits. A good calculator will take this into account and show you a "net savings" by taking into account the loss in tax savings.
These mortgage calculators can assist you in deciding whether to refinance or buy a home.
