For most people, being a homeowner is the ultimate milestone, but is your loan really working for you? Banks are creating new innovative home loan options constantly, and with these tempting offers, it can be easy to slip into a mortgage trap. If you have had your current home loan for a few years, it’s very possible your circumstances or needs (or both) have since changed. You may even be considering completely refinancing your home loan. While your current mortgage may still fit into your budget, you could now be finding that you require some flexibility, or you’re looking to incorporate new features into your home loan that were not available before. Whatever the reason, a home loan repayment calculator can provide great insight into your potential repayments if you refinance. The following are important points to consider when using an online calculator.
Use a Calculator from a Reputable Online Lending Institution
When it comes to making a decision about your home loan, it’s important to know the calculator you’re using provides estimates that incorporate the most up-to-date information on rates and other fluctuating market figures. Use an online calculator provided by a reputable lender or mortgage broker you trust to ensure all estimates are as accurate as possible. Banks must provide clear and honest information, and their mortgage calculators should reflect this.
Be Aware of Hidden Loan Costs
Loan calculators are online tools to help buyers be aware and fully informed of estimated financial repayments to their lenders. There are so many home loan options available, that it is almost impossible for a calculator to offer a precise figure. Most provide estimates on borrowing capacity, loan repayments and even stamp duty, however fail to incorporate other potential hidden fees.
When comparing home loans and researching potential repayments, don’t forget to factor in any upfront and/or ongoing costs that you may incur when you make a loan switch. This can include settlement fees, mortgage registration fees, loan establishment fees and exit fees. Taking this into account will better prepare you for making the change.
The Calculator Is NOT A Broker
Don’t get too carried away using a mortgage calculator online, as it’s easy to take its word as gold. If you’re looking for real advice that fits your real-world situation, talk to a mortgage broker or lending institution for advice tailored to your unique needs. Figures provided by a calculator should be taken as an indication only, and are not indicative of professional advice or quotes. If unsure, talk to an experienced professional.
Reviewing your home loan periodically is a great idea and may be very beneficial for you long-term, especially if you discover a loan that is flexible to your unique needs. Mortgage repayment calculators are fantastic tools for providing insight into potential repayments on other loans, and are useful when comparing. However, if you are seriously considering making a switch, talk to an experienced home loan professional. Being fully informed of all your options and any extra charges ensures you make a knowledgeable decision for the future.