Refi Calculator with Cash Out

Cash-Out Refinance Impact Calculator

Calculation Results:

Enter your details and click 'Calculate Impact' to see the results.

function calculateRefiCashOut() { var currentHomeValue = parseFloat(document.getElementById('currentHomeValue').value); var currentLoanBalance = parseFloat(document.getElementById('currentLoanBalance').value); var currentAnnualRate = parseFloat(document.getElementById('currentAnnualRate').value); var currentRemainingTerm = parseFloat(document.getElementById('currentRemainingTerm').value); var desiredCashOut = parseFloat(document.getElementById('desiredCashOut').value); var newAnnualRate = parseFloat(document.getElementById('newAnnualRate').value); var newLoanTerm = parseFloat(document.getElementById('newLoanTerm').value); var closingCosts = parseFloat(document.getElementById('closingCosts').value); // Input validation if (isNaN(currentHomeValue) || isNaN(currentLoanBalance) || isNaN(currentAnnualRate) || isNaN(currentRemainingTerm) || isNaN(desiredCashOut) || isNaN(newAnnualRate) || isNaN(newLoanTerm) || isNaN(closingCosts) || currentHomeValue <= 0 || currentLoanBalance < 0 || currentAnnualRate <= 0 || currentRemainingTerm <= 0 || desiredCashOut < 0 || newAnnualRate <= 0 || newLoanTerm <= 0 || closingCosts 0) { currentMonthlyPayment = currentLoanBalance * currentMonthlyRate / (1 – Math.pow(1 + currentMonthlyRate, -currentTotalMonths)); } else { // If rate is 0, it's just principal / term currentMonthlyPayment = currentLoanBalance / currentTotalMonths; } if (isNaN(currentMonthlyPayment) || !isFinite(currentMonthlyPayment)) { currentMonthlyPayment = 0; // Handle cases where currentLoanBalance is 0 or term is 0 } // Calculate new loan principal (assuming closing costs are rolled into the new loan) var newLoanPrincipal = currentLoanBalance + desiredCashOut + closingCosts; // Check LTV for new loan (common limit is 80% or 90%) var newLTV = (newLoanPrincipal / currentHomeValue) * 100; var ltvWarning = "; if (newLTV > 80) { // Common LTV limit for cash-out refi ltvWarning = 'Warning: Your proposed new loan amount results in an LTV of ' + newLTV.toFixed(2) + '%, which may exceed typical lender limits for cash-out refinancing (often 80%). You might not qualify for this amount or may face higher rates.'; } // Calculate new monthly payment var newMonthlyRate = newAnnualRate / 1200; var newTotalMonths = newLoanTerm * 12; var newMonthlyPayment = 0; if (newMonthlyRate > 0) { newMonthlyPayment = newLoanPrincipal * newMonthlyRate / (1 – Math.pow(1 + newMonthlyRate, -newTotalMonths)); } else { // If rate is 0, it's just principal / term newMonthlyPayment = newLoanPrincipal / newTotalMonths; } if (isNaN(newMonthlyPayment) || !isFinite(newMonthlyPayment)) { newMonthlyPayment = 0; // Handle cases where newLoanPrincipal is 0 or term is 0 } // Calculate cash received (net of closing costs if they were paid out of pocket, but here we assume rolled in) var netCashReceived = desiredCashOut; // Assuming desiredCashOut is the amount the borrower wants to receive, and closing costs are added to the principal. // Calculate change in monthly payment var changeInMonthlyPayment = currentMonthlyPayment – newMonthlyPayment; // Positive if savings, negative if increase // Calculate estimated equity remaining var estimatedEquityRemaining = currentHomeValue – newLoanPrincipal; // Calculate break-even point (if monthly payment decreases) var breakEvenMonths = 'N/A'; if (changeInMonthlyPayment > 0) { breakEvenMonths = (closingCosts / changeInMonthlyPayment).toFixed(1); } // Display results var resultsHtml = ltvWarning; resultsHtml += '

Refinance Outcome:

'; resultsHtml += 'New Loan Principal: $' + newLoanPrincipal.toFixed(2) + "; resultsHtml += 'New Monthly Payment: $' + newMonthlyPayment.toFixed(2) + "; resultsHtml += 'Net Cash Received: $' + netCashReceived.toFixed(2) + "; resultsHtml += 'Change in Monthly Payment: ' + (changeInMonthlyPayment >= 0 ? 'Savings of $' + changeInMonthlyPayment.toFixed(2) : 'Increase of $' + Math.abs(changeInMonthlyPayment).toFixed(2)) + ' per month'; resultsHtml += 'Estimated Equity Remaining: $' + estimatedEquityRemaining.toFixed(2) + "; resultsHtml += 'New Loan-to-Value (LTV): ' + newLTV.toFixed(2) + '%'; if (changeInMonthlyPayment > 0) { resultsHtml += 'Estimated Break-Even Point: Approximately ' + breakEvenMonths + ' months'; } else { resultsHtml += 'Break-Even Point: Not applicable (monthly payment increased or stayed same)'; } document.getElementById('result').innerHTML = resultsHtml; } .calculator-container { font-family: Arial, sans-serif; max-width: 600px; margin: 20px auto; padding: 20px; border: 1px solid #ccc; border-radius: 8px; background-color: #f9f9f9; } .calculator-inputs .input-group { margin-bottom: 15px; } .calculator-inputs label { display: block; margin-bottom: 5px; font-weight: bold; } .calculator-inputs input[type="number"] { width: calc(100% – 22px); padding: 10px; border: 1px solid #ddd; border-radius: 4px; box-sizing: border-box; } .calculator-inputs button { background-color: #007bff; color: white; padding: 12px 20px; border: none; border-radius: 4px; cursor: pointer; font-size: 16px; width: 100%; box-sizing: border-box; } .calculator-inputs button:hover { background-color: #0056b3; } .calculator-results { margin-top: 20px; padding-top: 15px; border-top: 1px solid #eee; } .calculator-results h3 { color: #333; margin-bottom: 10px; } .calculator-results p { margin-bottom: 8px; line-height: 1.5; } .calculator-results strong { color: #007bff; }

Understanding Cash-Out Refinancing

A cash-out refinance allows homeowners to convert a portion of their home equity into liquid funds. This process involves replacing your existing home loan with a new, larger loan. The difference between your old loan balance and the new, larger loan amount (minus transaction costs) is paid to you in cash.

Why Consider a Cash-Out Refinance?

Homeowners often pursue a cash-out refinance for various financial objectives:

  • Debt Consolidation: Using the funds to pay off higher-rate debts, such as credit cards or personal loans, potentially simplifying payments and reducing overall financial burden.
  • Home Improvements: Funding significant renovations or repairs that can increase the property's market value.
  • Major Expenses: Covering large expenditures like educational costs, medical bills, or starting a business.
  • Investment Opportunities: Utilizing the funds for other investment ventures, though this carries its own set of risks.

Key Factors in a Cash-Out Refinance

Several elements influence the viability and benefit of a cash-out refinance:

  • Property Market Value: The current worth of your home is crucial as it determines your available equity. Lenders typically allow you to borrow up to a certain percentage of your home's value (e.g., 80% Loan-to-Value or LTV).
  • Existing Principal Balance: The remaining amount on your current home loan. The lower this is relative to your home's value, the more equity you have.
  • Annual Rates: Both your current and proposed new annual rates play a significant role in your monthly payment and the overall cost of the loan. A lower proposed rate can lead to monthly savings, even with a larger principal.
  • Loan Duration: The length of your new loan (e.g., 15, 20, or 30 years). Extending the duration can lower monthly payments but may increase the total amount paid over the loan's life.
  • Refinance Transaction Costs: These are fees associated with originating the new loan, including appraisal fees, title insurance, and lender charges. These costs can either be paid upfront or rolled into the new loan principal.
  • Requested Cash Funds: The specific amount of money you wish to receive from your home equity.

How the Calculator Works

Our Cash-Out Refinance Impact Calculator helps you estimate the financial implications of such a transaction. By inputting your property's market value, existing loan details, desired cash funds, and proposed new loan terms, the calculator provides:

  • Your new estimated monthly payment.
  • The net cash you would receive.
  • The change in your monthly payment compared to your current one.
  • Your estimated equity remaining after the refinance.
  • The new Loan-to-Value (LTV) ratio.
  • An estimated break-even point, indicating how long it would take for potential monthly savings to offset the transaction costs.

It's important to remember that this calculator provides estimates. Actual loan terms and eligibility depend on various factors, including your credit profile, lender policies, and market conditions. Always consult with a qualified financial advisor or loan professional before making significant financial decisions.

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