Use mortgage calculators for 2011 financial planning

December 29th, 2010

Many people make resolutions in January for the coming year. Many people who make resolutions fail to make the plans that would cause their resolutions to become achievements. Mortgage calculators make your financial planning easier so your resolutions can come true.

Amortization calculator

Savings rates are very low and even if you refinanced to a historically low mortgage rate in 2010 chances are that your mortgage rate is significantly higher than your savings rate. The cost to borrow for your mortgage is greater than the interest your bank pays you for your savings. While there is this gap you may be considering paying down your higher interest mortgage debt and foregoing putting more in your low, close to zero, percent savings account.

Using an amortization calculator you can quickly see what an extra $50 or $100 per month can do to shorten your mortgage term, reduce your interest payments and convert low interest savings revenue into higher interest debt relief. If in the future your savings rate is greater than your mortgage rate you can reallocate the extra funds you have paid to your mortgage to your higher interest savings account. Because you have already accelerated your principal reduction, in the future continuing with your scheduled mortgage payment you will continue to accelerate your principal reduction.

Refinance calculator

If you have been waiting to refinance until the "bottom of the market" you may have missed that mark. Rates have climbed considerably since the beginning of November and if you still have not refinanced you have missed an opportunity for increased savings. However even though rates are higher than they were sixty days ago, they are still pretty low and might be able to benefit you with considerable monthly savings on your mortgage payment.

Further savings may be had if you use a refinance mortgage to consolidate other debt such as credit card debt. Using a refinance calculator input your current mortgage information and the amount of debt you wish to pay off in 2011 to see if a mortgage refinance can help you save on your total monthly debt payments and increase your savings. Or following the example in the paragraph above, continue with the same total monthly payments after refinancing as you had before and accelerate the principal reduction on your new mortgage. Combining the refinance calculator and amortization calculator to plan on debt consolidation, payment relief and/or principal reduction on your new mortgage refinance.

Pre-qualification calculator and closing costs calculator

Of course the ultimate in New Year's resolutions for many Americans is the purchase of a new home, fulfilling the American Dream. If 2011 is the year for you and your family to purchase a new home proper planning will be important to successfully qualifying for your new home loan and closing your purchase transaction.

Pre-qualification calculators will allow you to see what your purchasing power for a new home loan is with your income, credit obligations and funds available for down payment and closing costs. The closing costs calculator will assist you with how much money you will need for that down payment and those closing costs.

Finally, the site can assist you throughout the year with your financial planning with tips for using the calculators, timely news and economic information that impacts mortgage and housing markets.

Don't start 2011 by making resolutions without the proper plans to make those resolutions become reality for you. Use the mortgage calculators and information available throughout the year to help you plan for your resolutions success.

Posted By :
Dennis C. Smith is co-owner and broker of record for Stratis Financial in southern California. He has over twenty years' experience in the mortgage industry.

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