Mortgage calculator – financial consumer agency
Benefits of Using a Mortgage Calculator
If you are planning to buy your first home with a mortgage, using a mortgage calculator – financial consumer agency will be very helpful. When you apply for a mortgage loan, you will face some experiences, tasks, and challenges that you might never have before. Therefore, it is best to have as much information as possible to make sure you make the best decision.
A mortgage calculator offers more insights and information related to mortgages. With more insights, you will be more confident in purchasing your dream home. Here are the benefits of using a mortgage calculator.
Decide on Your Down Payment
You might think that it is better to make as large of a down payment as possible. But if you put all money you have into a down payment, you may lack on other expenses, such as furnishing the home or closing costs. With a mortgage calculator, you will be able to see the effect of different amounts of down payment on your monthly mortgage payment. This way, you can find the right balance between the down payment, monthly mortgage payment, and other costs.
Know How Much You Can Afford to Pay for a Home
The basic benefit of using a mortgage calculator is finding out how much you can afford to pay for a home or property. Besides any other costs you perhaps have, like mortgage insurance and passing mortgage stress test rules, your monthly mortgage payment is perhaps the largest determining factor in how much you can afford to pay for a home or property.
Monthly mortgage payments are frequently bigger than many first buyers realize. So seeing real numbers and how they fit in your monthly budget will be very helpful for you to be more realistic in choosing a property you can afford.
Choose the Frequency of Payments
The monthly mortgage payment is not the only one when it comes to the standard frequency of payment. You can also choose a mortgage that allows you to make the payment weekly, bi-weekly, and half-monthly paid fortnightly. If you do not know yet what difference that these payment frequencies make, a mortgage calculator can show you.
Most people find it hard to understand how long they will be responsible for making payments. Depending on the amortization period you opt, you will likely have mortgage payments for at least 25 years. Making monthly payments means you will make 12 payments a year, 26 payments a year for bi-weekly payments, and 52 payments a year for weekly payments.
In general, the more often you pay each year, the more you will pay over the whole year. While that probably sounds discouraging, the extra that you pay every year can reduce the amortization of the mortgage as well as the total interest you will pay over the lifetime of the mortgage.
Those are the benefits you can get by using a mortgage calculator – financial consumer agency. Nowadays, there are even online mortgage calculators that make it much easier for you to calculate your mortgage.