| Original mortgage amount | Original
amount of your mortgage. |
| Appraised value | The appraised
value of your home when you purchased it. |
| Current term in years | Total length
of your current mortgage in years. |
| Years remaining | Number of years
remaining on your current mortgage. |
| Income tax rate | Your current
income tax rate. |
| Calculate balance | To let the
calculator determine your remaining balance, based on your original loan
information and years remaining, check this box. To enter your own amount,
leave this box unchecked. |
| Current Appraised value | The
current appraised value of your home. |
| Loan balance | Balance of your
mortgage that will be refinanced. |
| New interest rate | The annual
interest rate for the new loan. |
| New term in years | Number of years
for your new loan. |
| Loan origination rate | This is the
percentage of the new mortgage that is paid to the lender as the loan
origination fee. Typically this fee is 1% of the loan balance. |
| Other closing costs | Estimate of
all other closing costs for this loan. This should include filing fees,
appraiser fees and any other misc. fees paid. |
| Points paid | This is the number of
points paid to the lender to reduce the interest rate on the mortgage. Each
point costs 1% of the new loan amount. |
| Current payment | Your current
payment is the sum of principal, interest and PMI. Because refinancing does
not affect your insurance or taxes they are not included here. |
| New payment | Your new payment is
the sum of principal, interest and PMI. |
| Monthly PMI payment | Monthly cost
of Principal Mortgage insurance (PMI). For loans secured with less than 20%
down, PMI is estimated at 0.5% of your loan balance each year. Monthly PMI
is calculated by multiplying your starting loan balance by this percent and
dividing by 12. When your loan balance exceeds 20% of the original purchase
price, your PMI payment drops to zero. |
| Monthly PI payment | Monthly
principal and interest payment. |
| Break even monthly payment savings |
The number of months it will take for your monthly payment reduction to be
greater than your closing costs. |
| Break even PMI & interest savings |
The number of months it will take for your interest and PMI savings to
exceed your and closing costs. |
| Break even total savings after tax |
The number of months it will take for your after tax interest and PMI
savings to exceed your closing costs. |
| Break even total savings vs. prepayment |
This is the most conservative break even measure. It is the number of months
it will take for your after tax interest and PMI savings to exceed both your
closing costs and any interest savings from prepaying your mortgage. The
prepayment amount used in this calculation is the amount that you would have
to spend on closing costs. |
