Planning Your Mortgage with a Mortgage Payment Calculator!
Each and every lender providing a mortgage product has its own benefits and short comings You don’t only need a mortgage for when you buy a home but also you can need to renew or transfer your mortgage from one lender to another upon its maturity, or you may even require a refinance. If you have read some of our previous articles you must be familiar with one of our favourite terms “know your options” and you will no doubt understand that not all mortgages are created equally, and that you should definitely review your various mortgage options, and gain an understanding beyond just the rate . The calculator which is designed for the ad hoc purpose of calculating the monthly payment on the basis of applied mortgage rate is called as mortgage payment calculator. It is one of the most valuable tools which you can seek easily if you are looking for home financing, as it will give you an idea of what payment to expect. You can calculate various types of mortgage payments through this calculator as per your requirement, be it monthly, bi-weekly, etc. There are many calculators available, and of course they vary in their level of difficulty as well as their accuracy. If you are using a calculator for the very first time then the below tips can be useful!
What makes the calculator so useful?
Mortgage payment calculator is not as same as the simple mortgage calculator as it does not only tell you about the mortgage interest payment, but also refers the principal amount; split it into the time span you choose for the mortgage and then add it into the payable interest. Thus, it gives you the full monthly payment value instead of displaying only the interest value. Before you decide in pulling the trigger on a mortgage there are a few things that you need to figure out. The calculator helps in evaluating various payments which you can then compare to your budget. At the time of this writing, interest rates are very low, and with the recent news in the economy, many people are opting for the variable and adjustable mortgage rate options, but remember, both of these options are tied to the prime rate, and if the prime rate moves up, it effects your payment. With the adjustable option, your mortgage payment will increase as prime increases, and with the variable, your payment will stay the same (until your amortization goes over the maximum original amount you were approved for) but the portion going to interest will increase and the portion going towards principal will decrease.
Several mortgage rate calculators are available online and some of them are free and need only the rate of interest of mortgage, amount of mortgage taken and the time span of the mortgage as inputs. You can click on the ‘amortization’ tab also to view the entire detail of the mortgage payments. Although you can simply use ‘calculate tab’ also to view the monthly payment amount. For further information or for information in depth regarding the loan analysis, switch to amortization window.
The ultimate mathematical answer!
You can find a mortgage rate calculator to be an important tool on mortgage selling sites. These are easy to use and simple to follow. Being in the comfort of your own home and having the luxury to surf and get calculations at the tip of your finger.
Remember though, these mortgage payment calculators have been known to be inaccurate. I have had clients call me thinking that they can afford half of what they actually can. These instances often occur, especially when there are other sources of income that come into play. The truth of the matter is, no matter how convenient and useful a mortgage payment calculator may seem. And don’t get me wrong, there is definitely use for one. But in order to get a full assessment and something that you can bank on, you need to call a professional. No mortgage payment calculator can replace that.