Calculating
How Mortgages Can Work for Markham Homeowners
Financial news pundits often opine
about Canadians accumulating too much debt. However, there is such a thing as
good debt. Good debt is taken on with the specific goal of overall financial
health in mind. Having a mortgage so you can own a home is good debt. And once
you have your own home, you have equity that can help you in other ways. By
gathering information, homeowners can find a plan that works for long-term
financial stability. A
mortgage calculator can help Markham homeowners consider their options.
Using
a Mortgage Calculator
A mortgage calculator is a handy
on-line tool that allows potential homeowners to input mortgage terms and see
the financial implications of different choices. By comparing variables such as
interest rates, amortization periods, down payments and payment types, the
calculator spells out the advantages of each situation. By lowering interest
rates by a percentage or two, or by increasing your payment schedule,
homeowners can save thousands of dollars over the term of a mortgage or loan. While
a mortgage calculator can be useful while considering an initial home purchase,
it can also be a helpful tool for seeing how home equity can work towards help
with other financial goals.
Consolidating
Debt
It’s easy to accumulate debt, but
harder to pay it off. Interest rates on credit cards can be prohibitively high.
When someone loses a job or becomes ill, bills can accumulate. An unexpected
expense, such as the need for a new roof, can suddenly become a financial
burden. Feeling overwhelmed by debt can be extremely stressful. Often it makes
sound financial debt to consolidate debts.
Let’s say you have $75,000 in credit
card debt at the rate of 18.9%. If you are paying a minimum payment of 4% of
the outstanding balance, it will take more than twenty years to pay it off,
paying over $48,000 in interest. If you consolidate all that debt into a home
equity secured loan, you are likely to be paying along the lines of 4%
interest, which, over the years, can save you thousands of dollars.
Two
Types of Loans
A home equity line of credit (HELOC) is
a flexible line of credit that uses a portion of the equity in a home (the
value of the home minus the outstanding mortgage) to secure a low-interest line
of credit. A second mortgage on a home
can also be an option. A second mortgage has fixed interest rates and payment
schedules. A a second mortgage can be a good option for those who worry about
fluctuating interest rates and want to set doable targets for paying down
debts. To see if a second mortgage is a viable option, get an accurate picture
of the financial obligations by entering all terms into a mortgage
calculator.
Use
a Mortgage Calculator to Consider Your Options
Before speaking to a reputable mortgage specialist, Markham homeowners
should work out the implications of various options with an accurate on-line
mortgage calculator. This will allow you to independently compare rates and
give you the information you need to make the best decision for long term
financial health.