Use the advanced mortgage calculator to calculate mortgage payments and other details in just a few keystrokes.
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Mortgage Summary
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| Total Loan Term (Years) |
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| Total Interest Paid |
| Total Monthly Payable |
| Total Payable with Interest |
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Monthly Amortization Schedule
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Types of Mortgages
Different types of mortgages are detailed below for better understanding:
- Fixed-rate mortgage: The interest rate stays the same for the entire term, so your monthly payments may be easier to understand.
- Adjustable-rate mortgage (ARM): The interest rate changes periodically depending on market conditions, which can lead to lower initial payments but more risk when rates rise.
- FHA loans: Mortgages insured by the Federal Housing Administration allow you to make a lower down payment but require mortgage insurance.
- VA loans: For veterans, active service members, and eligible spouses, these loans are backed by the Department of Veterans Affairs and do not require a down payment.
- Jumbo loans: Mortgages for amounts greater than limits set by federal agencies, and used for high-value properties.
- Balloon mortgage: This offers lower monthly payments but requires a lump sum payment at the end of the term. For more information read on Investopedia.
How is a Mortgage Approved?
There are several processes of mortgage approval:
- Application: You have to apply for a mortgage, and provide financial information, credit history, property documents, employment details for approval.
- Approval and down payment: Once approved, you will be required to make an advance payment, which will reduce the total amount borrowed.
- Repayment: You will have to make monthly payments as per the mortgage term. This will include both principal and interest amount.
Components of a Mortgage Payment
The key components of a mortgage are mentioned below:
- Principal: The original amount borrowed for the mortgage.
- Interest: The cost of borrowing the money, which is expressed as a percentage or Interest rate. It may be fixed or variable over time.
- Term: The length of time you have to repay the mortgage, usually it may 15, 20 or 30 years. A longer term means lower monthly payments but more interest paid overall.
- Down payment: This is an advance payment made by the buyer, which is a percentage of the purchase price of the property. When you make a larger down payment, it can reduce the amount you have to borrow.
- Monthly payment: The monthly payment includes both the principal and interest amount, which you have to pay on a monthly basis.
- Amortization: A schedule that shows how each payment is divided between paying down the principal and covering interest costs over time.
However, a mortgage is a fundamental part of home ownership. This allows you to spread the cost of purchasing a house/apartment over a number of years rather than paying for it in full.
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