Home Mortgage Calculator

Owning a new home is the biggest pilgrimage or what you can call a milestone nowadays. With a generation gap, the prices of real estate and building materials got the largest peaks, which was actually unthinkable at those older times. Nowadays, it’s almost impossible for an average human to own a home without mortgage and loan procedure.

But taking out a mortgage isn’t as overwhelming as managing it well and keeping the calculations handy. Many bank brochures are filled with the bigger formulas, but we’re here to automate the management calculations for you with a range of simplistic Home Mortgage Calculators.

Using these calculators would benefit you significantly with the convenience, decoding the complex calculations, and understanding how the major factors can affect amortisation. You don’t need to get concerned even if you’re a beginner in the Home Mortgage calculation or a professional. This calculator will walk hand-with-hand to help you in the journey of mortgage mastery.

Types of Mortgage Calculators

Basically, we know the term Mortgage and generally, the calculation comes in our mind with only a few factors to calculate instantly. We work briefly but with internal detailed resolution with two different types of calculators, including one with basic and other advanced approaches.

Basic Mortgage Calculator

Basic Mortgage Calculator works better to use the important factors fed by you on the boxes, including the overall principal amount, interest rates, and tenure period. After calculating all these numbers within a formula, it assesses the monthly payments as well as the total payment you’re going to pay till the end, as well as the total interest you’re paying. Having all these different details uniquely will get you a better approach on the basic mortgage.

Advanced Mortgage Calculator

Once you know about the results of Basic Mortgage calculations, you can still make a new assessment with the Advanced Calculator. We all think in a way keeping the overall interest and monthly instalments in our minds as the major calculations. In exception, the Advanced Mortgage Calculator explores the additional calculations, including the Amortisation Scheduling.

In simple words, it’s a complete table of payments fixed with multiple parameters. After having this detailed information table, you can make the Mortgage schedule disciplined and work more cleverly. This will include the scheduling with remaining amount listed after every month of payment, as well as a column for the extra payments being paid between the periods.

Key Factors Affecting Mortgage Calculations

Every loan fixed up with any unique financial institution is majorly based on the four important key factors, the Principal Amount, Annual Rate of Interest, Tenure Period, and Down Payment (if applied). All these factors equally support the Monthly EMI and complete additional amount you’re paying. 

Loan Amount and Interest Rate

Keeping it simple to the financial realm, Higher Principal Amount is going to bake the greater monthly payments for you. This amount works parallel with the EMIs if the tenure period is exact with the annual interest rates.

When Loan Amount is factorised as an important element, you cannot ignore the similarly affecting or befriended element, i.e., the Interest Rates. Larger interest rates can affect the Loan Amount more insanely, and once you’ll calculate the same with tenure period, a simple change in rate percent can result in a greatest impact on your overall payments.

Loan Term and Repayment Options

Sometimes, we think of the Home Mortgage to be more convenient in payments as we think about it in the way they advertise. Most of the online marketing companies are boosting the Mortgage sales only based on sharing a longer tenure period in the initial.

Tenure Period is so necessary to be understood, as longer you’re waiting to complete the mortgage, and larger interest rates are being charged all along. Keeping that in mind, you may have heard about different types of repayment options, including the Constant and Variable interest rates. Constant or fixed rates lock the steady payments but variable rates start lesser.

Down Payment and Loan-to-Value Ratio

Apart from the above two-three important factors, Down Payment also plays an important role in the interest rates, tenure period, as well as the principal amount. However, this factor isn’t majorly projected or utilised in the Home Mortgages, so we listed it in the end.

In most of the banks and financial institutions, it works the way if you’ll pay 20% of down payments, private mortgage insurance would get avoided automatically. Whereas, the higher Loan-to-value ratios also increase the interest rates parallel. Also, initialising with a more down payment can help you either in decreasing the tenure period or the amount of monthly EMIs.

Advanced Mortgage Calculations

Mortgage Calculator functionality can also be used in three different instances which are as follows:

Mortgage Affordability Calculator

When keeping the Mortgage at a priority, we forget some of the most important things and see an illusion of being affordable in our eyes. This happens with every beginner going for a new Mortgage Loan, as there are some important things they forget, including the income, debts, expenses, and credit score.

Fortunately, Mortgage Affordability Calculator sums up your eternal borrowing capabilities on the basis of all the above important assessments. After you acknowledge these things, you can use it simply to assess the supreme home mortgage that you can afford on the basis of finance.

Refinance Calculator

If you think that refinancing your current mortgage can be super beneficial for you; please wait for a moment. A mathematical approach must be required before thinking anything, and the same thing can be assessed with the Refinance Calculator. It helps you analyse the refinancing on the basis of potential interest savings and costs uniquely in each and every case.

It works with first getting to a breakeven point. Before hustling up, you first need to get the cost and interest rate modifications which result in a break-even point. Once you’re there, making the final few modifications as per your affordability can show you resultantly if Refinancing is any good in your case.

Mortgage Comparison Calculator

Finance companies, banks, and institutions are approaching the peak in terms of numbers as they are just opening the newer franchises getting mortgages to a larger pie of traffic. But the convenience in finding them has created the complexity in comparing the different loan options, offering multiple interest rates, LTV offers, insurances, and tenure period.

Mortgage Comparison Calculator helps you in comparing them efficiently as you can get the interest rates and all the important information from all of them. Later, you can evaluate the total cost of each mortgage keeping data in the calculator with customizable criteria. Take required time, but don’t hassle in choosing the wrong provider.

Mortgage Calculators and Financial Planning

There are many finance freaks who love to use Mortgage Calculators for financial planning. You must be thinking of it as an absurd combination, but it won’t be like that after reading these:

Rent vs. Buy Calculator

Should I buy a home or rent one? This question is rising vastly on Google searches and multiple blog posts are providing details within acknowledgements. Words aren’t all you need to know that, as you first have to assess if you’re financially viable to buy a home or rent one. We’re seeing the reality in front of our eyes, where we need to have an overview from up above.

Rent vs Buy Calculator would show you the reality from up above to conclude if buying a home is more monetarily possible than renting one for a long-term. Once you’ll feed the important details, you can assess the monthly EMIs on the basis of down payment, tax savings, and price appreciation, before taking this step.

Affordability Calculator

The Affordability Calculator would help you financially in the same way it assisted you above with the advanced mortgage calculations. We got the complete information about the important factors as they can feasibly be known through the online bank and institution sites.

After having details, we can evaluate the monthly EMIs to compare it with our monthly expenses. If it’s even sounding break-even after complete calculations, you should determine a more suitable price range for a home. Customise the values; make the assessments.

Interest-Only Mortgage Calculator

In terms of the interest only mortgages, you need to keep in mind to preview payments during the interest-only period, before higher principal and interest payments get started. These calculations can simply be summed up with the Interest-only Mortgage Calculator.

Using Mortgage Calculators for Decision Making

People are hiring a few Mortgage Managers and Consultants nowadays as it’s being so complicated to make perfect decisions for pre-approval, mortgage closing, or PMI. Though, you won’t find any need of that once you will have the below use cases of Mortgage Calculators:

Mortgage Pre Approval Calculator

Mortgage Pre Approval is majorly done on the gratefulness of your Financial Profile, or the inclusion of all those scores together. Most of the time, those mortgage profiles that make faster pre-approval are deep wells if they aren’t understood properly.

Mortgage Pre Approval Calculator would rationalise the preapproval process by estimating the loan amount you may qualify for. This sounds superficial and useful enough to be navigated properly before choosing a provider in hassle.

Closing Cost Calculator

Most of the time, we don’t keep a track on some T&Cs, Charge Ratios, and Closing Amount before signing the deal. Besides, even if we keep a track on them, it’s hard to be well known about that till the closing time. So the Closing Cost Calculator helps you to estimate the total closing fees and charges on the basis of remaining tenure period and institution scenario.

In this case, you can also explore and evaluate multiple financing scenarios to make the closing cost look nuts. Evaluation from all sides before closing a mortgage is a most important process or otherwise you’d result in paying higher secret costs.

PMI Calculator

PMI stands for Private Mortgage Insurance and it’s a type of financial insurance that protects the financial provider or lender in the worst case if a borrower defaults in paying the mortgage back. These costs are charged to the borrower, when they majorly never think about it.

PMI Calculator works as a helping hand and assesses the Private Mortgage Insurance costs using the multiple factors, including loan amount, repayment terms, credit value, house value, and the PMI percentages.

Summary and Conclusion

The Mortgage Calculator is one among the most important financial calculators to be used for assessing loan amortisation schedules and the overall interests being charged. It’s a beneficial protocol for those who want to check the affordability of Home Mortgage, compare different financial institutions, and calculate the other additional costs available on the same.

Adding to the same, users can also calculate the Refinancing profits and reliability with this calculator functionality. If you’re going ahead to buy a new home, using this versatile tool to clearly sum up the important factors, including costs, affordability, and options before committing.

Making a commitment before having clarity in mind is the consequential step, and taking such a step in finance can dig a deep hole in the back. First utilise this tool for better calculations and use it till the end from shopping a mortgage option to closing the same.

FAQs (Frequently Asked Questions)