Mortgage Calculators: How To Use Them To Make Better Decisions?

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As we move along this flurry of blogs in the last few weeks, and discussing the important aspects of homebuying to veteran or first time buyers, we want to cover a more mathematical aspect that can help you make decisions by yourselves and potentially save you time in the mortgage acquisition process.

Have you heard of the mortgage calculator before? We are delighted to offer you this online tool that is meant to help you make more realistic decisions about the mortgages that are a best fit for you. But before you try out the link, we want to tell you a bit more about each, and the purpose they serve.

A mortgage calculator is a tool used to determine a mortgage’s monthly payments. These calculators factor in the amount financed, term of the loan, and interest rate to calculate the monthly payment. But what are the types of calculators that can do all of this work for you?

The Maximum Mortgage, or the maximum loan, is the total amount a borrower can afford. Maximum loan amounts are used in standard loans, credit cards and line of credit accounts. A maximum mortgage will be provided to the borrower if approved for a loan. Lenders typically base a maximum loan amount on their own risk diversification parameters and the credit profile of a borrower. You can also get a government sponsored loan that may dictate a maximum loan amount for certain types of loans.

Next up, the Mortgage Analyser: a calculation used to find the value of a property investment less the amount of money owed on the property in a mortgage. This involves viewing the type of financing used to secure the asset, the value of the property in general, and the raw amount of money still owed on the mortgage note.

This brings us to the Payment Analyser, which helps calculate the mortgage payment for several payment frequencies (weekly, bi-weekly, semi-monthly and monthly). This will also help you discover how by how many years you will shorten your amortization. Amortization is the repayment of loan principal over time. There is also a similar calculator in the prepayment analyser, which calculates your mortgage payment and helps you figure out how many years you will shorten your amortization and how much interest savings you will realize by making a prepayment on your mortgage.

And finally, there is the Mortgage Isolator. This one is a little bit different than the others, and either simple or complicated; whichever way you look at it! This part of the calculator lets you isolate any variable that determines a mortgage payment and basically play around with & study it.

What do we learn from all this? Looking for and getting a mortgage is far from simple. There are too many things involved especially with number, so these calculators on our site are there to help you better more informed decisions before you approach lenders. They help put you in a position of confidence and readiness and make your first or next homebuying experience less stressful.

Next week, you will re-read about a topic we discussed earlier this fall, entrepreneurship and mortgages. Are any of you running your own business? Stay tuned!