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How To: Refinance Your Bankrate Mortgage

Bankrate Mortgage

How Bankrate mortgage calculators work. Bankrate offers free daily mortgage tips, calculators and market news on their website. Every day mortgage tips and information is updated throughout the day as banks, lenders, mortgage brokers and others release their lending rates and programs. To learn if a mortgage is right for you, try the following math with theBankrate Mortgage calculator.

Determine how much you can afford to spend each month on a mortgage. The amount you can borrow will depend on your household income and other financial considerations. Take into account any other debts you have, like credit cards, auto loans, or student loans. Your debt to income ratio is a calculation that determines how much you can comfortably afford on an ongoing basis. You can get the answers to this question using an online calculator, or by contacting Bankrate to get a customized calculation. Then compare your results to those of several online interest rates to determine which lender offers the best deal.

Use the Bankrate Mortgage calculator to see how much more you could afford to pay each month with a lower interest rate, as long as your monthly payments remain the same. Find out how your monthly payments would change if you were to take advantage of some of the special interest rates currently offered by some lenders. Some lenders are reducing the length of their adjustable rate mortgages. Others are raising the interest rates on mortgages that are currently set at present values. With these changes in mind, calculate how your monthly payment would change if you switched to a different lender or if lower interest rates took effect.

Calculate the amortization schedule for your mortgage. This is the time it will take for your new interest rate to fully apply. Enter the amount of time needed for the new interest rate to equal the amortization, or the amount of payments still needed each month. The calculator will show you if the mortgage rates you are looking at are the current recommended interest rates. If they are not, go back to the beginning and add several more years to the amortization period. Then add another number to the amortization to reflect the extra amount you will pay for your mortgage, assuming that you were to refinance at the new mortgage rates.

Do your best to get a better idea of how much longer-term you would have to keep your mortgage. Enter the length of the term you want to maintain, from five years to 30 years, and the amount of interest you will pay over this duration. There are many ways to structure your mortgage so that you wind up paying less in total interest over a longer-term. With some of the special mortgage deals currently available, it may not make financial sense to refinance for a longer-term.

If you want to refinance for a shorter term, think about shortening the length of the loan. This is especially true if you plan to move within a few years. You can often reduce your payments and save money by refinancing for a shorter term. Talk with an independent mortgage broker to find out more about the advantages and disadvantages of short-term versus long-term fixed-rate mortgages.

The Bankrate Mortgage calculator allows you to compare an adjustable rate mortgage with a longer-term fixed-rate. Adjustable rate mortgages come with variable interest rates, which can vary up and down, depending on the United States federal budget and the state money market. With a longer-term loan term, your monthly payments become gradually lower over time, but the interest rate is reset higher at the start of each term. With a shorter loan term, the interest rate reset is higher, which can make monthly payments higher.

It is possible to find ways to make your monthly payments more affordable while still keeping the home you want. Refinancing can help you reduce your monthly payments while still keeping the home you want. Talk to an independent mortgage broker to find out more about how to make refinancing to the lowest fixed rate possible a reality. The sooner you get started, the better your chances of saving money and keeping the house you want. To learn more about saving money on interest and owning the home you want, register for a free mortgage guidebook using the links below.

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