Simple to use online Mortgage Calculator to easily calculate your monthly payment. We also show you the amortization table so you can see the principle month by month.
How to use the Mortgage Calculator?
The Mortgage Calculator allows you to calculate the size of your monthly mortgage payments based on the amount you want to borrow, the loan’s interest rate and the length of the loan. You only need to set the following parameters:
1. Home Price: This is the full price of the home you want to buy.
2. Down Payment: This is the part of the purchase price that you as a buyer pay in cash, up front, and does not finance with a mortgage. Generally, the larger the down payment, the better the deal that you can get on a mortgage. You can usually qualify for the best available mortgage programs with a down payment of 20 percent of the property’s value.
3. Length of the Loan: Here, you essentially have to enter the length of the mortgage in years.
4. Interest Rate: Interest is the amount lenders charge you to use their money. Interest charges generally accrued as a percentage of the amount borrowed. The interest rate is usually quoted in per cent per year.
Now if you set all the parameters and then click to the Calculate button.
What does the amortization table mean in the Mortgage Calculator?
First, we should talk about a little bit about amortization which is the process of gradually paying down a debt, usually by making monthly payments throughout the loan’s term (which is the length of the loan in the Mortgage Calculator. In the early years of a mortgage, most of the monthly payment goes toward payment of interest and little toward reducing the loan balance. If you take a look at the Amortization Table, you can see this by examining the two columns called ‘Payment to Interest’ and ‘Payment to Principle’.
5 things you should avoid when you want to get a mortgage
1. Don’t allow the lenders tell you what you can afford! This way you can avoid to commit to a mortgage larger than you can comfortably afford, because the real challenge is figuring how much you can comfortably afford to borrow given your other financial goals.
2. Watch out for Mortgage Brokers! Never forget that mortgage brokers don’t lend their own money. The mortgage broker may be sacrificing your best interests to get a bigger commission.
3. Avoid loans with prepayment penalties! If your loan has a prepayment penalty, lenders have the right to charge you thousands of dollars for repaying your mortgage before it’s due.
4. Avoid negative amortization mortgages! Say no to these constructions right away as they can completely ruin you.
5. Avoid mortgage life insurance! Most of the time it’s just a waste of time and money. Most of the time it’s just a waste of time and money.