Posted on: 10th Feb, 2010 11:49 pm
i want to know how much i will save overall when i refinance my mortgage.
current mortgage
$76,000 left on 20 year mortgage ( initial loan was $128,000 )
have been paying for 7 years ( 13 years left )
$890 principal+interest
5.75 %
new mortgage
$76,000 10 year mortgage
4.75 %
$1700 total closing costs
do you need any more information ?
questions.
how much will i save on interest ? ( reducing by 1 % )
how much will i save on payments? ( reducing term by 3 years )
how much will i save overall ?
thanks.
current mortgage
$76,000 left on 20 year mortgage ( initial loan was $128,000 )
have been paying for 7 years ( 13 years left )
$890 principal+interest
5.75 %
new mortgage
$76,000 10 year mortgage
4.75 %
$1700 total closing costs
do you need any more information ?
questions.
how much will i save on interest ? ( reducing by 1 % )
how much will i save on payments? ( reducing term by 3 years )
how much will i save overall ?
thanks.
Hi,
Using the Refinance Calculator, I find that if you refinance the current loan from 5.75% interest rate to 4.75%, your mortgage payments will reduce by $93.16. As a result you will end up saving about $2355 in interest charges over the entire loan term. However, you will be paying a closing cost and it will take you about 32 months to recoup the money. So, you should not leave the property unless 32 months have passed after the refinance.
Using the Refinance Calculator, I find that if you refinance the current loan from 5.75% interest rate to 4.75%, your mortgage payments will reduce by $93.16. As a result you will end up saving about $2355 in interest charges over the entire loan term. However, you will be paying a closing cost and it will take you about 32 months to recoup the money. So, you should not leave the property unless 32 months have passed after the refinance.
The thing to remeber with refinance is that it doesn't have to be just about the interest rates.
Refinancing provides you with a range of options. Pay your loan off sooner by upping the repayments, reduce your total payment by stretcching out the term, look ata proportion of cash-out to pay off high interest debt like credit cards.
don't get trapped into just looking at the interest - it's like only eating the apples in a fruit salad.
Refinancing provides you with a range of options. Pay your loan off sooner by upping the repayments, reduce your total payment by stretcching out the term, look ata proportion of cash-out to pay off high interest debt like credit cards.
don't get trapped into just looking at the interest - it's like only eating the apples in a fruit salad.
So, what I am understanding is I will save some interest money after several months. I intend to stay in the house for a few years. So in addition to the interest savings I will also save 3 years worth of payments of $ 890 dollars each That is about $ 32,000 . Sweet CASH ! ! !
The calculator showed interest savings but not the 3 years of payment savings. I also intend to take the $ 93 and put it in as extra principal payment each month. This will also help reduce the ending term. Correct ? Where is the calculator for this calculation ?
Thanks for your help.
The calculator showed interest savings but not the 3 years of payment savings. I also intend to take the $ 93 and put it in as extra principal payment each month. This will also help reduce the ending term. Correct ? Where is the calculator for this calculation ?
Thanks for your help.
your $93 will absolutely save you quite a bit of money. i don't know of a calculator that you can use to determine the amount saved, though it may well exist. the calculations are actuarial in nature, and i am not an actuarial. but i can certainly state that that extra $1000-plus each year will end up in quite a bit of savings.
and i apologize for being so vague.