Calculating your monthly Payments

To calculate your monthly payment at 1.95%, you must multiply your loan amount by 3.7. (  100k times 3.7 =$370. principal and interest THESE NUMBERS SUCH AS 3.7 ARE PURELY CALCULATOR NUMBERS. 200k, (ALWAYS LEAVE OFF THE LAST THREE ZEROS) times 3.7 equals first years payment AT 1.95%. Subtract that amount from your current principal and interest and that will represent you monthly saving. Multiply that figure by 12 months, and that is your first year total saving. To repeat the process for five years, simply multiply the new first year principal and interest payment by 1.075 ( another calculator number) to determine the next years payment. This is how you increase the payment ( NOT THE RATE!) 7.5% each year for five years. Escrows are optional.

The one figure you want to obtain is the total saving amount for five years. Multiply that number by 17.45 to obtain a 10% return for 30 years lump sum. or 10.06 to obtain a 8% return for 30 years. To understand these programs properly, it is important to see a detailed customized computer proposal comparing your current loan to a low rate loan and looking at the math of a thirty year amortization schedule. Thinking a bit outside the box and being innovative can be extremely profitable for those who are savvy and understand the power of cash flow.