The Latest Mortgage Calculator With Extra
Payments: Pay Off Your Debts Earlier!
Buying a house on his own is undoubtedly one of the most expensive transactions a person makes in his lifetime. But only a few can afford the whole cost at once. As a result, people usually settle for a mortgage payment system. And to help you with all the calculations and schedules regarding mortgage payment, the mortgage calculator with extra payments is the most suitable choice.
In order to lower the interest rate of your mortgage loan and lessen the payment time, extra payment is the most effective way. But how much extra should you pay a month? And how will it impact the total interest and loan duration?
I know, that’s a hard calculation. But no worries. The mortgage calculator with extra payment will make this job easier for you. Let's take a look at what this calculator with extra payments is all about.
What Is Extra Payment In Mortgage Loan?
Usually, the duration of paying a mortgage loan is fixed. According to your choice, it can be ten years, 15 years, 20 years, or 30 years. But most people tend to choose the 30 years duration to pay off the debts as it allows lower monthly payment. However, It has a comparatively higher interest rate than the other plans.
Now you may think that you can go for a short duration loan with less interest. Getting a mortgage loan with a shorter duration means you need to pay a high amount monthly. Also, you need to have a handsome credit score. If not, you can't have that. In that case, a long duration loan with higher interest is your only option.
But you can lower this interest rate by making some extra payments. But what are extra payments? It is the additional amount of money that you can pay after paying your monthly installment. It can be $50, $100 or more than that. As it is an extra amount paid by you willingly, there is no fixed amount. You can pay as you wish.
Why Is Extra Payment Necessary In Mortgage Loan?
If you ask why I should make an extra payment, the answer is simple. To reduce the amount of interest that you need to pay the lender and be free of debt sooner.
For example, let’s say your actual principal is $300,000 for a mortgage loan, the interest is 3.8% APR, and the loan duration is 30 years. So, in 30 years, you will pay about $203,235 as interest without any extra payments. That's a considerable amount. But if you pay an additional $100 each month, it will lower your actual principal and interest rate with it. And you will have to pay $180,450.99 interest, and you can pay off the whole loan within 26.5 years. That's quite a saving, right?
What Is The Benefit Of Using A Mortgage Calculator With Extra Payments?
Using a mortgage calculator with extra payments helps you to keep track of your loan and payments. You can create your payment schedule here. You can also check how your additional payments are impacting the total loan.
A mortgage calculator with extra payments is able to calculate the decreasing loan duration with every extra payment you make. It is also able to show you how much your interest rate has dropped.
If you have a target year by which you want to pay off your loan, you can also calculate how much extra you need to pay each month or week using this online calculator.
The latest mortgage calculator with extra payments has all the programs that you may need. Not only additional monthly payments, but it can also help you with weekly/ biweekly/extra yearly payments.
Calculating all this stuff using a regular calculator is undoubtedly difficult. Also, you need to know the algorithm that the bank uses. Why take such trouble when you can get it done in some seconds utilizing a mortgage calculator with extra payments?
Final Words
The Mortgage Calculator With Extra Payments is undoubtedly a great help for those who are struggling to keep a record of the home loan. It also clarifies how small extra payments make an enormous impact on the total loan. So, use this calculator and make all the calculations easier.
But be sure to talk about the extra payments with your lender/bank. Some lenders mention a penalty fee in the loan contract if you pay off a certain percentage of your total principal. We wish you to be debt-free as soon as possible.