How to use a home mortgage refinance calculator

Home mortgage refinancing allows you to get a new loan with new terms on your home. You can stretch your remaining payments out using another 30 or 40-year loan, get a lower interest rate and even borrow extra money on top of the amount that you have left on your current mortgage. A refinance calculator can help you determine what type of refinancing rate you can get for your new loan.

Enter loan amount

Enter in the current value of your home, the amount of your current mortgage, and any second mortgage or home equity loan that you may have. Give the amount of any additional money you’re seeking, on top of the money you may owe on a first and second mortgage.

Select loan type

Choose your loan type. Common loans include a 40-year fixed, 30-year fixed, 15-year fixed,
3/1 adjustable rate mortgage, and 5/1 adjustable rate mortgage.

Choose loan fees

Enter in a number from zero to four that represents the amount of fees that you will be willing to pay upfront in order to get a lower interest rate. For example, a “one” refers to one percentage point, which means that you will be charged 1% of the loan total upfront in order to receive a lower interest rate.

Provide home specifics

Give the calculator information on where you home is. This will help it pull up the best refinance rates for your area, as rates can vary by location. You will need to enter in the state and possibly the county you live in - the type of home you own, like single family, two-unit property, or a condo - and what you will use the property for, like as your primary residence, as a second home or as a rental or other investment property.

Offer credit specifics

Lastly, you will need to specify an estimate of your current credit. You don’t need to give an exact number, but choose from a range. Ranges are usually 580 to 619 equals poor credit, 620 to 659 equals fair credit, 660 to 699 equals good credit, 700 to 739 equals great credit and anything 740 and above equals excellent credit. The better your credit is, the more offers and better rates the calculator will be able to give you.