Definitions:
Loan amount owed - Loan amount owed
is the total remaining balance on a loan. If you are
uncertain of your exact balance, enter an estimate that
is as close as possible.
Loan payment - The payment amount
is your current monthly payment.
Loan months - Left The number of months
you have left to make payments on a loan.
Credit card balance - The outstanding
balance on your credit card. You do not need to include
finance charges, they will be calculated based on your
interest rate.
Credit card rate - Annual interest
rate you pay on outstanding credit card balances. This
calculator assumes simple interest is charged every
month at 1/12th of your annual rate.
Credit card payment - Credit card
payments are based on your outstanding balance and annual
interest rate. For this loan comparison, the monthly
payment is the amount required to pay off your credit
card in same number of months as your consolidation
loan. Your actual credit card payment may be lower,
but will often require many more payments.
Interest rate - Annual interest rate
for your new consolidation loan.
Term in months - Number of months
for your new consolidation loan.
Up front costs - Any fees you are
required to pay up front to receive this loan. This
could include appraisal fees, loan origination fees,
etc.
Points - Number of points paid to
bank for this loan.
Rate earned on savings - This is
the rate you would have received if you had put your
closing costs into savings. Enter your short term savings
rate. For most people this is currently 4% to 5% annually.
Income tax rate - This is your combined
federal and state income tax rates. It is used to determine
income tax savings when you use a home equity loan to
consolidate your debt.
Loan type - The two most common loans
types, home equity and personal, differ in fees, rates
and tax deductibility of interest. Home equity loans
often have higher fees, but usually have lower rates
and a tax deduction for interest paid. Personal loans
do not have a tax deduction for interest paid, and have
a higher interest rate but often have lower fees. These
are important considerations when choosing a loan.
Include closing costs in loan - If
you include your closing costs in your loan, your loan
balance, monthly payment and total interest paid will
increase. You will, however, be required to pay less
money up front. Including your closing costs in your
loan may be a good option if you do not have funds available,
or you can achieve a relatively high rate of return
on your savings.
Loan Application
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