Six Types of Mortgage Calculators and Their Benefits

THREE MAJOR TYPES OF HOME MORTGAGE PLANS

The three most significant types of home mortgage programs are illustrated below in brief.

• Fixed-rate mortgage

The most popular kind is the FRM or fixed-rate mortgage, where the rate of interest is locked and will not change during the entire tenure of the loan.

You may also visit a mortgage specialist in Mississauga (or wherever you may need) to learn more about the FRM.

• Adjustable-rate mortgage

An ARM or adjustable rate mortgage program is characterized by an interest rate, which keeps increasing or decreasing throughout the loan tenure as the market changes from bearish to bullish and vice versa.

You may also engage a mortgage architect in Mississauga (or wherever you may want) to know more about an ARM.

• Hybrid adjustable-rate mortgage

An interesting derivative of an ARM is what is known as the H-ARM or hybrid ARM, where a particular rate of interest is guaranteed to remain fixed for a specific period of time. The initial rate of interest often tends to be lower than what is typically offered by the traditional thirty year fixed loan schemes.

You may also call a mortgage specialist in Mississauga (or wherever you may wish) to know more about the H-ARM.

SIX KEY TYPES OF HOME MORTGAGE CALCULATORS AND THEIR BENEFITS

A mortgage calculator is essentially an automated financial tool purpose-designed to help you estimate a payment amount that is based on several variables, such as type and tenure of loan, effective interest rate, and the amount supposed to be financed.

There are many types and styles of mortgage calculators widely available these days, but all of them sport analogous features and functionality.

This guide is meant to introduce you to various kinds of mortgage calculators readily available at present, when to utilize which one, and the potentiality they have.

A vast majority of the mortgage calculators are pretty easy to use for the end users; and some of them are even capable of accepting taxes, insurance, and other fees as inputs.

The most significant types of mortgage calculators and their benefits are explained below in brief.

You may also get in touch with a mortgage specialist in Mississauga (or wherever you may require) to know more about them.

• Mortgage payment calculator

This kind of mortgage calculator assists you to calculate the payment amount in case of a FRM or an ARM.

In order to determine the sum of payment, you are required to know a few things, such as the amortization period, amount of your loan, tenure of the loan, effective rate of interest, and type of your mortgage. Most mortgage payment calculators are to tell you the estimated amount that you are required to pay and annualize the mortgage balance.

• Mortgage refinance calculator

Any existing homeowner who is contemplating refinancing happens to be keen in knowing whether or not it makes any sense at all.

This kind of mortgage calculator will help such people to understand whether or not switching from an existing ARM to a FRM will prove to be beneficial and worth the cost. You are required to know what the present ARM terms are and the FRM rate you are likely to be deemed eligible for.

It will also help you to comprehend whether or not a lower rate is to offset your refinancing cost.

• Mortgage payoff calculators

This type of mortgage calculator is purpose-made to indicate how extra payments and different payment schedules are to affect your mortgage payoff date as well as the consolidated sum of interest that you are required to pay.

It is particularly beneficial for the folks who wish to build equity quicker and decrease the amount they are to pay in interest.

• Mortgage comparison calculator

Using a MCC or mortgage comparison calculator, one can afford to view the differences between an ARM and a FRM side-by-side, or you can choose to compare two ARMS that vary solely in terms of tenure to zero in on the one that appears to be more appropriate in your case.

• Mortgage points calculator

An MPC or mortgage-points calculator is an excellent tool to determine your break-even period when paying points on a mortgage.

While the idea of points is likely to be a tad confusing to a large number of home buyers, this nifty little utility does allow you to visualize the effect on the terms and payment when you are to pay points upfront.

• Second mortgage calculator

For all the homeowners who are toying with the very idea of applying for a second mortgage, the calculator shows the effect on the existing mortgage as well as the resulting gross payment.

They can also calculate and display the effects when you are to take out your first and also the second mortgage at the very same time, a process technically known as a piggyback mortgage.

It is no doubt a complex calculator, though it can really prove to be of great help in figuring out the ways for structuring a mortgage that is less than the regular twenty-percent down.