Mortgage Payment Calculator Gives You an Idea as to What Your Monthly Payments Will Be

 

So you’re ready to buy a home, but how do you know how much it will cost? A good place to start is with a mortgage payment calculator. This tool gives you a good idea as to what your monthly payments will be. To make sure you are getting the best result, it’s strongly recommended to use a mortgage calculator that includes taxes and insurance costs.

 

In places like Fort Lauderdale, where hurricanes and floods are a strong possibility, it’s important to factor in those costs as well, especially if you are going to live east of 95. Though, it is strongly recommended you consult with us about your mortgage, a payment calculator is a solid benchmark. We want to stress though that’s all it is, a benchmark.

 

Too often it is assumed that whatever number the calculator generates will be the exact monthly cost. This is rarely the case. Again let us stress that the number generated is only an estimation. If you are comfortable with what you see, then please pick up the phone and call us now. We will go through everything in complete detail and you will know exactly how much your monthly mortgage payment will be.

 

A good rule of thumb is to ensure that your monthly housing payment does not exceed 31% of your income.

 

Mortgage Calculator

Now let’s take a look at some of the terms involved with mortgage payment calculators.

 

Mortgage Amount:
This is how much money you are asking to borrow from the bank – To determine this number, subtract your down payment from the sale price of the home you want to purchase.

 

Down Payment:
The amount of money you put down to purchase the home. The amount you put down, normally dictates the type of loan you’ll receive. Here are some of the loan types:

1. Conventional Mortgage Loans:
   Can be anywhere from 10 – 30 years with fixed interest rate. You can secure this loan with a 5% down payment, however, keep in mind putting anything less than 20% down will require Private Mortgage Insurance (PMI) – PMI basically states that if you were to lose your house to foreclosure and default on your loan, the bank that holds your mortgage will be reimbursed by the insurance company.


2. FHA / VA Loans:
   FHA (Federal Housing Administration) loans can be acquired with a 3.5% down payment.
   VA (Veterans Affairs) loans are available to eligible veterans and require no down payment.


3. USDA Loans:
   Department of Agriculture loans are for those who have restricted incomes. These loans do not require a down payment.  

Closing:
The wonderful day when you become the owner of the home. This is also when you will bring your down payment check. 
 

Term:
The number of years you will repay the loan.

 

Interest Rate:
A percentage that is tacked on by the lender. Unfortunately, no one lends money for free.