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02-24-2009, 02:05 AM
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how much of a change would i see in my mortgage payment
if the interest rate went from 6.3% to 5.5%? would it be worth the hassle of refinancing?(my mortgage is for about 127,000) i was told my interest rate would be reduced to 5.5% but then on paper it says 5.5% in one place and almost 6% "APR" i dont really understand what the APR is or how it effects the payment and the total amount paid over the life of the loan.so two questions i guess...1) whats the savings i would see on my monthly payment if i reduced it by .8% on a 127,000 loan2)what is "APR" how does it effect my loan.30 year fixed
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02-24-2009, 07:18 AM
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1) It depends on how many years your loan is for.. I can't calculate exact savigs without that2) APR means annual percentage rate. That is the rate of interest you will pay on that loan. It is usually compounded. Ask you banker to give you a print out of your loan and compare.Alright - so right now you are paying around $786? $667 of that is interest. (assuming monthly compounding)For 5.5% on 127,000 with 30 year loan your payment decreases to around $721 with $582 of that amount being interest charges.I know it seems like a lot in interest right now.. but it decreases as you go. You could also make your whole monthly payment go towards the interest. This way you save some money in the end.
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02-24-2009, 08:23 AM
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I don't know what an apr is either. But , I just happen to be looking at a loan calculator bc I'm wanting to get a loan soon. But ne ways, if its a 30 yr mortgage, i'm guessing your payment is around 786/mo. If it goes down to 5.5 it would be around 704/mo. I'm guessing around a 80/mo difference. To me it would definatly be worth it. Hope it all works out good.
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