The top of the mortgage section will contain various mortgage product scenarios that your lender may share with you. These could be fixed rate mortgages (terms of 10, 15, 20 or 30 years) or low-down payment, construction to permanent loans or other programs applicable to you.
The Home affordability tab will permit you to create various loan scenarios based on your income, type of loan you choose: Conventional or government, housing expense ratio. FinLocker will import any liability, or debt that you have enrolled.
You can see that the PI (principal and interest) payment, taxes and insurance are included above as well as a potential homeowner association (HOA). To prepare for your purchase or refinance, we also calculate closing costs and down payment (based on the percentage you plan to pay).
For those that have a current mortgage loan, this calculator permits you to conduct “what if” scenarios if you pay additional payments on your mortgage loan. In the example below, we apply an extra $250 in the additional payment field which generates savings in total interest and reduced number of payments remaining due to accelerated payments.
Home Equity Line of Credit or HELOC1
A home equity line of credit is a second mortgage which is often used for home improvements, debt consolidation or other major expenses. The rate is typically tied to the Wall Street Journal Prime Rate + a margin. For example, if today’s prime rate is 5% and the margin is 1%, the rate is 5%+1%=6%. The lender may have various programs or offers such as prime + 0%, prime - .5%, or prime + 1%.
Many HELOCs permit interest only periods, which does not require principal payments during the Interest Only period. As such there is no amortization, or principal paydown on the unpaid principal balance.
Currently, the debt consolidation feature is a cash out refinance, meaning the credit card debts to be included in the new refinanced mortgage loan. In the scenario below, we include the credit card to be consolidated with the mortgage loan. The consumer may choose “I’m interested” and share their accounts with their lender who sponsored the FinLocker if they elect to move forward.