Free Mortgage Refinancing Calculator
Home mortgage loans come in two general varieties - variable rate mortages, and fixed rate mortgages.
Fixed-rate mortgages have both pros and cons.
Fixed-rate mortgages offer protection against rate increases. Should mortgage rates increase, payments on a fixed-rate mortgage stay the same.
However, if we see lower mortgage rates in the future, homeowners might weigh the costs and benefits of mortgage refinancing. Mortgage refinancing may involve paying a penalty. On the other hand, if refinance mortgage rates are low enough, the interest savings could be substantial. By using an excel spreadsheet, the value of interest savings can easily be compared against the mortgage prepayment penalty required by the lender.
The Mortgage Refinancing Calculator estimates the financial benefit from mortgage refinancing.
The Microsoft Excel spreadsheet considers both the Original Mortgage and the Refinance Mortgage, and shows the change in (i) total payments; (ii) interest; and (iii) principal.
The mortgage savings can be viewed on an undiscounted basis, or on a discounted basis.
Business Valuation Model