Introduction: Considering a mortgage refinance with cash-out? Our calculator helps you assess the potential changes in your monthly payment and savings. Input your current loan information and the cash-out amount you’re considering to explore the financial implications.
Formula: The calculator uses the standard mortgage formulas to calculate the current monthly payment and the new monthly payment after cash-out refinancing. The monthly savings are then determined by the difference between the current and new monthly payments.
How to Use:
- Enter your current loan amount in US Dollars ($).
- Input your current annual interest rate (e.g., 3.5 for 3.5%) as a percentage.
- Enter your current loan term in years.
- Specify the cash-out amount you’re considering.
- Input the new annual interest rate for refinancing.
- Enter the new desired loan term after refinancing.
- Click the “Calculate” button.
- View your estimated new monthly payment and potential monthly savings.
Example: Suppose you currently have a mortgage with a loan amount of $200,000, an interest rate of 4%, and a loan term of 30 years. If you’re considering a cash-out refinance of $20,000 with a new interest rate of 3.5% and a new loan term of 25 years, the calculator can estimate your new monthly payment and monthly savings.
FAQs:
- What is a cash-out refinance?
- A cash-out refinance allows you to refinance your mortgage and take out a portion of your home equity as cash.
- How does the calculator determine new monthly payment?
- The new monthly payment is calculated based on the increased loan amount (original loan amount + cash-out) with the new interest rate and loan term.
- What is the monthly savings?
- Monthly savings represent the potential reduction in your monthly payment after cash-out refinancing.
- Can I use the calculator for other types of loans?
- While designed for mortgages, the calculator can be adapted for other fixed-rate loans with similar terms.
- Does the calculator consider closing costs?
- No, the calculator focuses on the impact of the cash-out amount and changes in interest rate and loan term.
- Is it advisable to consider a cash-out refinance?
- Consult with a financial advisor to determine if a cash-out refinance aligns with your financial goals.
- Can I include other fees in the cash-out amount?
- The cash-out amount entered in the calculator typically includes fees associated with the refinancing process.
- Does the calculator account for changes in property value?
- No, the calculator assumes a fixed property value for simplicity.
- What factors should I consider before a cash-out refinance?
- Consider factors such as interest rates, loan terms, closing costs, and your overall financial situation.
- Is refinancing suitable for everyone?
- Refinancing suitability depends on individual financial goals, market conditions, and the specific terms offered.
Conclusion: Our Mortgage Refinance Cash Out Calculator is a valuable tool for homeowners exploring the potential financial impact of a cash-out refinance. Use it to make informed decisions about your mortgage and financial well-being.