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Updated about 12 years ago on . Most recent reply

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961
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Will F.
  • Investor
  • Los Angeles County, CA
277
Votes |
961
Posts

Worth it to Refinance? Where are rates going?

Will F.
  • Investor
  • Los Angeles County, CA
Posted

Hey guys do you know good calculators for figuring out breaking points for whether it's worth it to refinance loans?

I'm currently refinancing everything from personal home loan, our residential investment properties and our commercial loans.

Second question: Where do you think current rates are going? They've gone up so much in last few weeks. Do you think it's possible that they've raised them too much in a short period of time, so perhaps they will lower them a bit more? Or are they just headed up at a fast pace?

Any advice or resources would be great thanks!

Most Popular Reply

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189
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45
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Chad Ballard
  • Civil Engineer
  • Orange County, CA
45
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189
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Chad Ballard
  • Civil Engineer
  • Orange County, CA
Replied

Will F., Your payments would be as if the loan was paid over 20 or 30 years. When the balloon payment comes due in 5, 7 or 10 then rest of the loan comes due in a larger lump sum.

For example $100k loan amortized over 30 years with a balloon payment after 10 would leave you paying $477.42 per month and have a balloon payment of $79,2961.34 at the 10 year point ($36,073.76 in interest).

If you changed the balloon payment to 7 years then the balloon payment would be $86,536.88 ($26,162.35 in interest). Your monthly payment would remain the same at $477.42 since it is amortized over a 30 year period.

A fixed rate loan of $100k at 4% would have a higher monthly payment but would be paid off at the end of the term no balloon payment.

Do a search for "Balloon Loan Payment Calculator with Amortization Schedule" and you should find what you are looking for as far as a calculator to help you out.

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