Mortgage calculators can produce a lot of information. The monthly payment is a common question for borrowers. However, the millions of available calculators don’t always ask the right questions, and this can leave the borrower with incomplete or misleading information.
A basic mortgage calculator will ask for the loan amount, interest rate, and term. This will produce a monthly payment, including principal and interest. Some calculators may even list the amortization schedule, showing how the principal balance will reduce over the loan term.
This very basic information is necessary, but not enough. Mortgages are major financial obligations that should be carefully considered in comparison to other available mortgages, and in the context of the borrower’s personal circumstances.
Listed below are features of any good mortgage calculator. Please consider these when purchasing or refinancing real estate.
Tax & Insurance
Property taxes and homeowners insurance must be included in the mortgage calculation. This allows for more accurate comparison between the affordability of properties, and is critical for household budget planning. Even though these costs change annually, they are a significant component of home buyer costs.
Closing Costs
Financing the closing costs impacts the interest rate. A calculator that includes the fees will produce an APR (Annual Percentage Rate). This is a more accurate indicator of the cost of the loan. The APR makes loan comparisons simpler, and can reveal lender tactics to mask high closing fees with a low initial rate.
PMI
Private Mortgage Insurance (PMI) is a monthly fee, in addition to the mortgage payment. It can be a significant expense and must be included in calculations.
Total Amount Payable
The output should include the total amount that will be paid over the course of the loan. This is another useful number for comparison. It can show how expensive one lender is over another, or how different loan terms can impact the total amount payable. A shorter term could save hundreds of thousands of dollars.
Personal Income & Credit Information
Taking your personal financial situation into consideration is the best way to see if the mortgage options are realistic. The best loan terms will mean nothing if you simply can’t afford the payment.
Adjustable Rates
Budgeting for loan payments must acknowledge the highest possible payment under the terms of an adjustable rate mortgage. It’s risky to base a mortgage decision on a low initial payment, and may lead to an unaffordable mortgage very quickly.
What If’s
Explore options on the fringe of your comfort zone. A shorter term, or a larger down-payment could significantly reduce the monthly payment, and the total amount payable. The best calculators will allow you to experiment with all the options.
Which Calculator?
Being aware of the right information to enter into a mortgage calculator is useful, actually finding a calculator that does all of this would be even better. The best way to integrate all of this information is by using a combination of available calculators. Here are some good ones:
Mortgage Calculator.org – Principal, Interest, Taxes, Insurance, & PMI
Mortgage APR - Advanced APR calculation
Mortgage Affordability - Includes Personal Income and Expenses
Mortgage ARM - Adjustable Rate Mortgage Calculator
Mortgage Extra Payments - Additional payments to Principal: Monthly, Yearly, One-Time
Related Articles:
Accelerate Mortgage Payment Easily
Avoid Foreclosure – How to Fight for Your Home
You should make a calculator that does all of that!! Put it right here on your site.
And don’t forget one that will let you put in your extra payments to principal so you can see how much difference that makes! And it should let you do extra monthly payments as well as one time lump sums.
It would be nice if there was one all-inclusive calculator that had all of these features. Your post reminds me of my post on the True Cost of Home Ownership. Basically we’re both trying to say that one needs to consider ALL expenses included when buying a house. Just because you can afford the $700 rent for your apartment doesn’t mean you can afford a $700 mortgage payment.
Excellent resource list Hunter! Most first time buyers start out without learning the basics and pay a heavy price due to ignorance depending solely on their agent.
Always good to be well informed especially when it involves home buying.
Hunter, thanks for a good overview of what people should consider in deciding how much house they can afford. I like it when people plan the affordability based on just one income. That way if one of them loses their job they won’t be in danger of losing the house.
That’s a great point Maggie. That is really planning for just about all contingencies. It would be highly unliely for a couple to have both partners out of work for an extended period.
[...] at Financially Consumed wrote about mortgage calculators. I hate to admit that I can get lost in a mortgage calculator. It’s so motivating to see [...]
Watch the throne tix…
With the most of the week, the running commentary, criticism, and praise of Kanye and Jay-Z’s monster album, Watch The Throne….
… [Trackback]…
[...] Read More: financiallyconsumed.com/wordpress/2011/06/01/mortgage-calculator-tips/ [...]…
When I initially commented I seem to have clicked the
-Notify me when new comments are added- checkbox and from now on whenever a comment is added I get
four emails with the exact same comment. Is there
a way you are able to remove me from that service? Thanks!
This article offers clear idea in support of the new viewers of blogging, that really how to do
blogging and site-building.
books on-line have been great, wether that they are ebooks or conventional hardbound and
paperback books
There have been tons of content in that the marketplace around this particular,
I think getting there reference might encounter decided to
discover this to place or even article truly informative.
Practical aim phrase this post is harmful. Simply I must enunciate how a
data supplied that the following has been special, simply repair much more in close proximity to full, helping along
with other prior information obtain the recently been actually first-class.
That the actual items youll take pleasure in carressed let us discuss important, thus My partner and
i definitely will place a couple of of the information
right here to construct this kind of actually perfect for solely
that the particular newbies here. Thank you these records.
In fact beneficial!
Your blog is really an enlightenment for us readers! Thank you very much!
I am sure this paragraph has touched all the internet
visitors, its really really nice paragraph on building up new webpage.
While searching on Dating I found your blog, there have been some excellent posts
here and Ill be checking back
Spot ill carry on with this writeup, I honestly think this website needs much
more consideration. Ill oftimes be again to read much
more, appreciate your that info.
allergic reaction hives difficulty breathing swelling of your encounter, lips,
tongue, or throat. Buy Zolpidem via the internet.
Tremendous things here. I’m very satisfied to look your post. Thanks so much and I’m having a look forward to contact you. Will you please drop me a mail?
power tools can really save you from quite a lot of headache, specially when that the job is very challenging,
Thanks a great deal for providing individuals with a very wonderful
possiblity to read critical reviews from this blog. It can be always very type and because well ,
Generally I don’t read article on blogs, however I wish to say that this write-up very pressured me to try and do it! Your writing style has been amazed me. Thank you, quite nice article.
Amazing! This blog looks just like my old one!
It’s on a completely different subject but it has pretty much the same layout and design. Superb choice of colors!
themselves, specifically considering that the fact that you might have done it whenever
you ever decided. The pointers because well served to give out a great
option to
My brother suggested I would possibly like this website. He
was entirely right. This submit actually made my day.
You can not consider just how a lot time
I had spent for this information! Thanks!
Woah this is just an insane amount of info, must of taken ages to compile so thank you so much for
just sharing it with all of us. If your ever in any other need of related information, perhaps
a bit of coaching, seduction techniques or just wide-ranging tips,
just check out my own site!
Im impressed, I have to admit. Genuinely rarely should i
encounter a weblog thats both educative and entertaining, and let me
tell you, you might have hit that the nail about the head.
Your thought is outstanding the problem is an element that inadequate individuals have been speaking intelligently about.
We have been delighted we stumbled across this at my hunt for something relating to this.
After examine several of that the weblog articles on your site nowadays, and I in fact such because
your system of blogging and sitebuilding. I saved that in order to my personal book mark internet site checklist and can likely be checking back shortly.
Could you attempt my website as correctly and also inform me what
you think.
Thanks a large amount for providing individuals with an exceptionally wonderful opportunity to read in detail out of this website.
It’s always so pleasurable and full of the first-class time for me personally and my office colleagues to search the blog particularly thrice weekly to study the new items you will have. And of course, were at all times pleased with your stunning tactics you give away. Selected two areas in this article have been undeniably the most efficient we have ever had.
Well, that the article is actually the freshest on
that notable topic. I agree with your conclusions and definitely will thirstily look forward to your approaching updates.
Saying thanks can not just be adequate, for the enormous clarity in your writing.
I can speedily grab your rss feed to stay privy of any updates.
Pleasant work and much success in your corporation efforts!
What your stating is totally accurate. I recognize that everyone need to say the
similar issue, in spite of this I just think you to set it in the way that all of us can recognize.
I also really for example that the images you put in the following.
That they match so nicely with what youre hoping to say.
Im certain youll achieve so quite a lot of people these
days with what youve got to say.
Any ladies out there seeking for a hot fresh new fit for Memorial Day
weekend Hit up that the lovely ladies over at Boutique Pink in Northbrklynstl
First-class and really informative blog. I really such as online
resources that have to do with getting ripped, so this is important to me to see
what you have here. Keep it going! force factor
Perhaps you must update that the php server on your webhost, WordPress
is kinda slow.