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There are many benefits of the amortization calculator. First,
this tool is a tool you will find on many websites out there. It
is designed to allow you to find out how much of a monthly
payment you will make on your home loan. It will also provide
you with details about how much interest and the total cost of
your loan will be by the time that you pay it off. And, it will
tell you how much of your mortgage payment will go towards
interest and how much will go towards the principal. But, did
you know that you can use an amortization calculator to help you
to save money?
There are several methods that this can work for you. The amortization
calculator is available to you prior to you making a choice
in a home loan through many websites. And, you should take full
advantage of it.
Save Money With Interest Rates
You know that the cost of your home is nothing compared to the
amount of money you will pay for it in interest during the time
you have the loan. But, do you realize the difference that only
a few percentage points can make? Take the time to use an
amortization calculator and you'll see just what it is. If you
are comparing two different banks, you may want to go with one
because it is the bank that you have always done business with.
But, punch in the facts and see how much the other bank can save
you with their lower rate.
The Loan Terms
Trying to decide about the length of your loan? If you are
looking forward to a lower payment because you plan to take out
a 30 year mortgage, figure out what the interest difference is
in these loans. If you can afford to go with a 20 or even a 25
year loan, you can shave thousands of dollars in interest from
your home's purchase. Point blank, you should go with the lowest
possible terms that you can afford and the amortization
calculator will tell you just how much.
Principal Versus Interest
Another way that the amortization
calculator can save you money is through seeing just how
much you will pay per month in interest as apposed to principal.
While you may not have much control over this number, you may
want to think about it. For example, at the beginning of your
mortgage term, you will pay mostly interest down on the loan.
When you get closer to mid way through, then you will begin to
see more principal being lowered on the loan. But, the
amortization calculator can show you what can happen if you go
with the lending institution that allows you to pay a little
extra per month on your principal.
These are just some of the ways that this simple tool really
can help you to save money on your home's purchase. Getting the
right loan makes all the difference and you can do just that
when you take the time to use a tool like the amortization
calculator to determine just how much you will pay.
About the author:
Julie-Ann Amos is a freelance writer from London, UK,
specialising in finance subjects such as loans, banking,
mortgages, amortization
calculators, etc. She recommends use of an amortization
calculator for calculations at http://www.amortization-
calc.com.
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