With the information from the affordability calculator, lenders can change their communication strategy to educate their borrowers on achieving their financial goals.Ī mortgage pre-approval calculator assess a borrower’s creditworthiness to estimate how much financing they can qualify for. Using the information from this calculator, borrowers evaluate how much mortgage they can realistically afford. This amortization schedule also shows when the borrower will no longer be required to pay PMI.Ī mortgage affordability calculator focuses on the borrower and their monthly incomes vs. In that case, this calculator showcases a factor known as private mortgage insurance (PMI), which will be an added cost for the borrower until they reach a certain percentage of loan to value (LTV).Īs a bonus, a loan officer can use a detailed breakdown of the loan balance year over year to generate an amortization schedule. Suppose the down payment is below the standard 20%. This calculator provides the lender with a breakdown of their monthly mortgage payment showing interest and principal reduction. A mortgage payment calculator creates an amortization schedule based on the loan amount, interest rate, down payment and loan term (typically calculated in years). There are many unique calculators that can educate borrowers and increase the volume of digital leads.Ī mortgage payment calculator is a tried-and-true solution for any borrower looking at financing options for their home purchase. Mortgage calculators are not a one-size-fits-all-tool. Once in the system, the lender can communicate with the potential borrower and guide them through the loan application process. Lenders can fix this issue by adding a clickable link where the prospective borrower enrolls themself into the lender’s mortgage CRM. If all the calculator does is provide the answer to the borrower without any follow-up communication or calls to action, the lender is not guaranteed to win the business. The best mortgage calculators use “microtransactions,” spacing out the questions in phases to make the calculator feel less daunting.Īnother factor for lenders to consider is how the calculator they use feeds into their marketing automation. Misinformation can cause frustration for the borrower, who may feel like they are a victim of a “bait and switch,” potentially souring the borrower’s relationship before it ever really began. If the information entered by the borrower is not thorough, the calculator will give an inaccurate answer. However, this can create challenges for lenders who use these mortgage calculators as a part of their lead generation strategy. You should also be comparing lenders to find the best mortgage deal for your situation.A great mortgage calculator collects the right amount of information for the mortgage lender without overwhelming the borrower. If you're using this calculator now, you're already halfway to getting the best deal - examining the different options available to you, and within your own budgetary constraints. Using different calculator tools can help you get the maximum benefits from refinancing or a new mortgage. The Mortgage comparison calculator assists in determining how much you can borrow to achieve an affordable payment, or if borrowing more over a longer term can meet your needs. If you utilized the full repayment term for each loan, you would pay $261,010.10 in interest for the 30 year loan and $100,570.47 for the 15 year loan.This amounts to a potential savings of $160,439.63 if you can afford the higher payments and make an additional down payment of $25,000.If you used the entire 15 year term to pay off the second loan, you would pay a total of $325,570.47 in P&I payments. Assuming you would take the full 30 year term to pay off the first loan, you would pay a total of $511,010.10 for P&I payments.Your monthly payment for the 30 year loan would be $1419.47 for the 15 year loan, it would be $1808.72.
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