Wednesday, December 10, 2008

How to Calculate a Mortgage and Figure Out Your Monthly Payments

The fastest way to calculate a mortgage is to use a mortgage calculator. There are several types of mortgage calculators, and there's one for your every need.

There's fixed rate mortgage calculator, a mortgage amortization calculator, an adjustable rate mortgage calculator, a balloon mortgage calculator, a refinance mortgage, an APR mortgage calculator, and many more.

A Fixed rate calculator is one of the most common calculators online. This is used to calculate a mortgage with a fixed interest rate. The values required here are your loan term, your loan size, and the interest rate.

If you want to calculate a mortgage payment, by month, enter the amount the company will loan you and the repayment schedule you prefer. Do you prefer a daily, a weekly, a monthly, or an annual calculation?

An adjustable rate calculator (ARM) requires different values and information from a fixed mortgage calculator. With an adjustable rate mortgage, the borrower starts off with a low interest rate, but bears the risk of future increases in mortgage rates.

On the other hand, if mortgage rates drop, the borrower reaps the benefits. With an ARM calculator, future adjustments can also be calculated using a predicted adjustment interest rate.

A balloon mortgage, typically, is a 10-year program. During the term, the borrower can pay only a fraction of the mortgage loan. However, when the mortgage "balloons," the borrower has to pay the unpaid balance.

With a balloon mortgage calculator, you can calculate a mortgage loan remainder once the mortgage balloons if you pay only a certain amount each month.

With a refinance mortgage calculator, you will see how much your potential savings will be, and also the number of months it may before you'd break even on closing costs.

APR or annual percentage rate shows the total cost of a mortgage by putting into the equation not only the interest rate but also other fees and points. If you want to calculate a mortgage and its real cost to the borrower, use an APR mortgage calculator.

Want more info on how to calculate a mortgage? Check out, a popular mortgage site that shows you how to find the best mortgage rates quickly and easily.

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