The loan comparison calculator is one of the finest tools you can have when trying to finance a new home. Purchasing a new home is a major decision having the best tools at your disposal will help you to reach your goal faster and with fewer losses in the end. Knowing the direction you need to take before applying for a mortgage gives you an edge.
A home loan comparison is much more than getting the numbers from one company for their products, it is about comparing products offered by a variety of venues and then finding out which one will work best for your particular circumstances. The home loan comparison calculator will help you to do that.
Home loans are a long-term expense. Most home loans are for terms of 15-30 years and with that time frame you are always taking a risk. In 30 years the economy can rise and fall several times. Employees can be phased out because of new technology and businesses can go belly up. Making a decision to get locked into a loan requires lots of thought and preplanning and using the loan comparison calculator is a part of this strategy.
Loan comparison calculator (its Australian version) will allow you to compare two loans with equal terms. You will need to enter the numbers that are common for both loans:
loan amount in Australian dollars
term of loan
Next you enter loan-specific data that is different from one loan to the other:
any upfront fees that are applicable
any ongoing/recurring fees that will be charged on a regular basis
interest rate that only applicable during the initial term
initial term itself and finally
ongoing interest rate - the rate that would be applied once initial term is lapsed.
Once you do so calculator will give you a side by side comparison of the two loans.
The first screen you see will be a graph type view of the results along with a statement about which loan will save you the most money. The second tab will give you more advanced results in the form of a breakdown of what you could expect the total payments in each category to be for the life of the loan. The final tabs show each loan graph and a complete repayment schedule that shows you how much of each of your payments will go toward the principal.
This loan comparison calculator operates with a number of assumptions made to the calculation scenario:
we assume that the term and amount of loan would be the same
ongoing fees are applied till the end of your loan
ongoing interest rate would be locked for the loan's life
While those parameters might vary in real life loans, you would still get the high-level view on your spending if you'll sign up on the particular loan contract.
DISCLAIMER: There is NO WARRANTY, expressed or implied, for the accuracy of this information or it's applicability to your financial situation. Please consult your own financial advisor.