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Payoff Calculators Can Help You Save Your Home

According to the Center for Responsible Lending, subprime foreclosures will cause 44.5 million homes to lose an estimated value of $223 billion over the next couple of years. Is now a better time to pay off your mortgage? For any type of loan, using a payoff calculator can help determine whether this is right for you, and if it can save you from further headache down the road.

Understanding a Loan Payoff Calculator

If you find yourself in a situation where you have the ability to prepay on your home loan, you might consider using a payoff calculator to determine the benefits of paying the balance of your home loan early. To find out how long it will take to payoff your loan, you can use a variety of online mortgage calculators. These payoff calculators present an amortization schedule that displays how much you owe each month, the amount distributed to both interest and principal, and how long it will take to pay off your loan.

Calculating Your Payoff Options

Depending on your financial budget and other investments, the life of your loan can be shortened by contributing more to your mortgage principle each month. If you come across a large sum of money and are contemplating whether or not to pay off your mortgage, it's important to consider which option will bring you the best return by using a pay off calculator. Calculating interest rates and tax benefits are a factor in determining whether paying the balance of your mortgage is better in the long run as interest rates will rise along with the possibility of foreclosure.


Sources:
"Protecting Your Home's Value," CNNMoney.com
"Why You Should (and Shouldn't) Payoff Your Mortgage," The Christian Science Monitor The Mortgage Professor

Posted By :
Kristi Shibata is a public relations and communication specialist. She graduated from University of California, San Diego, with a BA in Communications.


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