Online Mortgage Calculator – The Fundamentals

| September 3, 2009

Why You Should Use A Loan Mortgage Calculator


Majority of people make it simpler for the mortgage brokers to push them into offers that are more advantageous to the broker than the borrower – how?

Prospective home buyers who don’t have any knowledge about how these loans essentially function become inundated by the procedure and terms and conditions. Principal, points, interest only loans, interest rates, FRM and so on can become puzzling.

loan_mortgage_calculator australia 2010

You should get ready with a loan mortgage calculator prior to contacting mortgage brokers or banks. There are scores of them on the Internet and majority of them are quite simple to use. You should understand your personal financial condition and some fundamental mortgage calculations can create a level playing field for you. This would probably help you save plenty of money.

How can you do it? It’s simple.

Online Mortgage Calculator – The Fundamentals

Monthly payment – possibly the easiest function of a useful online loan mortgage calculator is determining your monthly payment.  


All you require is:

  • The interest rate of the loan
  • The amount you wish to borrow
  • The tenure of the loan – normally in months or years

You would just input these figures into the required fields and submit – the loan mortgage calculator would furnish you with the amount that you have to pay on a monthly basis.

For instance, you wish to borrow 200,000 at 6% for a repayment term of 30 years – your monthly mortgage payment would be $1,199 every month.

Assess the Scenario

A useful online mortgage calculator would not halt there and it should furnish you with some other important figures.

Overall Amount that the Borrower Needs to Pay

In the example given above, the overall amount to be paid on interest and principal by the borrower after 30 years would be $431,640.

Overall Amount of Interest Payable by the Borrower

In the aforesaid example, the overall interest amount payable by the borrower would be $231,640. Around 53% of the overall amount that you spend is on interest.

You should consider that a minor adjustment in your interest rate can significantly affect the overall amount payable by you.

For the above example, if the interest rate changes to 7.5%, it would cause the overall amount to rise significantly. Now the total payment would be $503,280 and $303,280 would simply go towards interest. The monthly payment would be approximately $1,398.

This easy example demonstrates how a 1.5% hike in the interest rate can cost you more than $70,000 throughout the duration of the loan. Of course, you would look for the cheapest rate while you are searching for a home loan. The online loan mortgage calculator equips you with important knowledge before you contact the mortgage brokers or loan officers.

These simple tools would also let you know how much mortgage you can afford. A little bit of research can always help you find a better deal.

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Category: 2010, bank rates, cash rate, loan rate, Mortgage rates, Property Market, Rate Rise

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