Math wizards, can you help me out please?

[robbie3982]

I found some sites that show the amoritization of your loan and the difference that making extra payments can make, but what I want to do is a bit more complicated than any of the calculators I''ve been able to find seem to be capable of.

Right now, I pay extra each month on our mortgage so that we''ll end up making a bit over 1 and 1/3 extra mortgage payments per year (the reason for the odd extra amount is that I originally wasn''t thinking clearly and divided our full monthly payment, which includes our PMI and taxes, by 12 and when I realized my mistake I figured, hey, if we can pay it, why not?). By paying this much extra per month, we''ll end up paying off the mortgage 7 years early and we''ll save almost $60k over the life of the loan in interest. We''ll also save over $7k in PMI because we''ll hit 20% LTV 4 years earlier.

What I want to figure out is how much we''ll save in years and $ if we add what we pay in PMI to our extra principle payment once PMI drops off. At first I thought I''d just change the amount & length of the loan to what it would be when PMI drops off and then change the extra payment amount and add the length of this new calculation to how long it took us to get to the point where PMI dropped off, but I think that would be off because the amoritization would be off, right?

Ack, I''m getting confused

 

[meresal]

http://www.mortgageloan.com/calculator/mortgage-payoff-calculator


Try this one... you just need to input 4 yrs, and enter in the extra PMI payments that you will be adding to your PRIN payments once PMI stops... It will give you the $$ amount.


ETA: If you can determine how much you are going to still owe with 4 yrs left, then this calculator you can back into to find your answer... just wiggle the "desired pay off time" around a bit, and once you hit the payment amount closest to what you will be paying incl your PRIN and PMI, that will give you the time...

http://loan.bizcalcs.com/Calculator.asp?Calc=Loan-Early-Payoff

once you have the lesser than 4 yr amount, type "4 years 0 months" into the "desired" area and then subtract the previous "total paid" amount from the new amount, and that will show you how much you have saved by adding the extra payments.

This is all assuming your interest rate will not change of course...

 

[gemgirl]

These days, this is the best and safest way for us to save money, according to Suze Orman and some other financial wizards. I''m trying to do the same thing. I know the numbers can start driving you crazy after a while. I know that if we can manage to send in two full payments extra a year, it will subtract an average of ten years off the life of your mortgage. That''s going to really help if the economy continues to worsen as it has been.

 

[blondebunny]

i should be able to answer this... but im off school mode, but I just wanted to tell you how much my bf is in love with your white cat.... everytime i logg onto PS and he sees it, he says how cute it is

 

[robbie3982]

Thanks, Meresal! It looks like we''ll pay off the loan in 20 years instead of 30 if we''re able to stick to that plan! It would be so great to be able to have our house paid off at 45 instead of 55! If all goes according to plan, that means that we''d finish paying the mortgage right about when we''d start paying for college.

Gemgirl, I''ve actually heard that it''s smarter to invest extra $ rather than pay extra on your mortgage, assuming that you make about 8% in the market and have an interest rate that''s lower on your mortgage. Personally though, this just sounds way too risky for me!

Blondebunny, awe, thanks! She''s Dh''s and my first baby .