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13b

Mortgage Piggyback Calculator

Comparing Two Piggybacks

Who This Calculator is For: Borrowers trying to decide between two combinations
of a first and second mortgage.

What This Calculator Does:This calculator compares the total cost of one combination
first mortgage plus a second mortgage to that of another combination,
over a specified future period.

 
Enter the Following:
Information About You and Your House
   Is This Loan for the Purchase of a Property or a Refinance?
  How Long Do You Expect to Stay in Your House, in Years?
  Rate of Interest on Savings  (e.g. 3.5)
  Income Tax Bracket ( e.g. 27 )
Information About Combination One
  First Second
  Loan Amount  
  Interest Rate on Loan  (e.g. 7.50)
  Term
  Points  ( Dollar Amount or Percent of Loan )
  All Other Closing Costs (e.g. 2250)
Information About Combination Two
  First Second
  Loan Amount  
  Interest Rate on Loan  (e.g. 7.50)
  Term
  Points  ( Dollar Amount or Percent of Loan )
  All Other Closing Costs (e.g. 2250)

DO NOT USE DOLLAR SIGNS ($), COMMAS (,) PLUS OR MINUS SIGNS ( + / - )
OR PERCENTAGE SIGNS (%) IN ANY INPUT BOXES


Read What the Mortgage Professor Says About
Using a Second to Avoid Mortgage Insurance

This is your marginal tax rate, the rate at which each additional dollar of income will be taxed. If you pay only Federal income taxes, it is the highest tax bracket you used when you calculated your taxes. Federal tax brackets currently are: 10%, 15%, 25%, 28%, 33%, and 35%. If you also pay state and/or local income taxes, these marginal rates can be added to the Federal rate. For example, if you had to pay 25% to the IRS and 5% to the state of Pennsylvania, your tax bracket is 30%. To perform a "pre-tax" analysis enter zero (0) as the tax rate. The period cannot exceed the shortest mortgage term. The period may be stated in fractions. For example, 25 years and 1 month would be entered as 25.083, 25 years and two months would be 25.167, and 25 years and 3 months would be 25.25, etc. All settlement costs that might differ between any two deals. This includes all lender fees of any sort, and all third party fees (such as title insurance, apprraisals and credit report), but excluding charges of governments which cannot vary from one deal to another. Do not include escrow reserves for taxes and insurance, or prepaid (per diem) interest. This affects tax savings on points because on a purchase transaction points are fully deductible in the first year whereas on a refinance the deduction must be spread over the life of the loan. This is the interest rate you could earn on the monies you spend during the period you are in your home. For most people, it would be the interest rate on a bank account or a money market fund. In after-tax cost comparisons, this figure is adjusted to an after-tax basis. The size of the mortgage insurance monthly premium is triggered by the down payment percentage. Mortgage insurance premiums drop significantly as the down payment crosses the 3%, 5%, 10%, 15% and 20% levels. When deciding on your down payment be sure to take this into account. To perform a "pre-tax" analysis select "Pre-Tax" from the drop down list. Estimate all closing costs other than points and enter your estimate for each loan here. For further information, read "How to Shop Settlement Costs". (Click on link at bottom of page) This is required only if your are now paying mortgage insurance. If you are paying mortgage insurance, we need to know the value of your house when the current loan was taken out so that we can figure out when the insurance payment will stop. We assume it stops when the balance reaches 78% of original value. The mortgage insurance premium is calculated automatically but you can override it. If you enter a value, mortgage insurance will be terminated when the loan balance equals 80% of the appreciated value of the property.