Mortgage calculators are not a one-size-fits-all-tool. There are many unique calculators that can educate borrowers and increase the volume of digital leads.
Mortgage Payment Calculator:
A mortgage payment calculator is a tried-and-true solution for any borrower looking at financing options for their home purchase. A mortgage payment calculator creates an amortization schedule based on the loan amount, interest rate, down payment and loan term (typically calculated in years). This calculator provides the lender with a breakdown of their monthly mortgage payment showing interest and principal reduction.
Suppose the down payment is below the standard 20%. In that case, this calculator showcases a factor known as private mortgage insurance (PMI) , which will be an added cost for the borrower until they reach a certain percentage of loan to value (LTV).
As a bonus, a loan officer can use a detailed breakdown of the loan balance year over year to generate an amortization schedule. This amortization schedule also shows when the borrower will no longer be required to pay PMI.
Mortgage Affordability Calculator
A mortgage affordability calculator focuses on the borrower and their monthly incomes vs. expenses. Using the information from this calculator, borrowers evaluate how much mortgage they can realistically afford.
With the information from the affordability calculator, lenders can change their communication strategy to educate their borrowers on achieving their financial goals.
Mortgage Pre-Approval Calculator
A mortgage pre-approval calculator assess a borrower’s creditworthiness to estimate how much financing they can qualify for. The borrower’s annual income and the mortgage’s term and interest rate is compared to their credit score, employment status, and other factors that determine the range for the total loan amount.
Rent vs. Buy Calculator
The rent vs. buy calculator shows that the grass may be greener as a homeowner instead of a renter. This calculator compares the borrower’s financial situations of both renting and buying a home.
These calculators showcase the appreciation of a home that the potential borrower will not experience as a renter for added value. Lenders can use the information gained from this calculator to educate potential borrowers about the benefits of homeownership.
Mortgage Refinance Calculator
These calculators answer the question, “How much money can a borrower save per month by refinancing?” The borrower compares their current mortgage payment to what they could be paying with a new term, interest rate, APR, and more.
Loan Comparison Calculator
Short term or long term? Fixed rate or variable rate? Loan comparison calculators help borrowers determine the loan that is right for their situation.
When comparing loans, there are a multitude of factors to be considered. This calculator goes further than the interest rate and loan term. Origination fees, commitment fees, balloon payments and the annual percentage rate (APR) are all factors that loan comparison calculators take into consideration.
Mortgage Payoff Calculator
A mortgage payoff calculator is a great tool that helps borrowers understand the interest they can save by increasing their mortgage payments. This mortgage amortization calculator clarifies the borrower’s situation using information on the original mortgage term, years remaining, current payments, and the current principal of the loan.
Mortgage marketing professionals who integrate their mortgage payoff calculator with their mortgage CRM often use a mortgage payoff calculator to educate their customers on different programs available, including a mortgage refinance.