| 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 for this loan. Points are usually only paid for home
equity loans. |
| 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. |
