What Can Be Inferred From The Mortgage Calculations

When you are looking to buy any real estate property or a house first thing that should come in mind is mortgage calculator. Mortgage calculator and loan calculator follows the same mortgage payment formula to provide you a final result. These financial tools help the people to estimate how much money they will need to spend as monthly mortgage payment. Without analyzing the things like “what mortgage can i afford” may lead you to foreclosure in the future.

Mortgage calculations can be done wither via online mortgage payment calculator or using the mortgage payment formula in the spreadsheet. These tools can help you to find answers for your queries related to mortgage hunting processes.

mortgage payment formula

When you are buying a mortgage for the first time then finding a reliable mortgage lender can be a complicated process. Finding the right one is not an easy thing. You need to consider so many factors to choose the right one.

Certain things how much amount you need to borrow from the lender and monthly payment calculations with adjustable mortgage rate are not an easy thing to accomplish manually or using the spread sheet applications. To make the process easier almost all lenders provide mortgage calculator on their website.

You can find many kinds of mortgage calculators online which are ranging from mortgage calculations using the mortgage calculator to the complicated mortgage calculator. Mortgage payment formula will differ slightly in various mortgage calculators.

You can use the mortgage calculator to calculate your monthly mortgage payment, how much money you will need to borrow and so on. If you struggle with the manual mortgage calculations then online mortgage payment calculator will be a good choice. You can use this calculators at free of cost.

If you want to refinance your current mortgage then you need to calculate the refinancing cost associated with your current loan. You can calculate this by using the refinance calculator. Simply you can get the projections and estimations on your finance through various financial calculators.

Mortgage payment formula

For those who are looking to find an excel formula to calculate monthly mortgage payment, here are the simple steps

1) Know the variables p, n and r

P – Rate of the capital amount you need to pay off on the mortgage

n- Number of payment terms

r – Interest rates

2) PMT()

In excel we have function called PMT () provide appropriate input and get an estimation

For instance if your principle amount is $100,000, interest rate is 5% and number of terms is 30 year then you need to supply the values as below

PMT (5%/12, 30*12, 100000)

Output you will be getting here will be $536.82

This function will return the output in the negative figures. If you want to get the amount in the positive figure just use the ABS () before the PMT ().

To play with various numbers just copy this formula and paste it in several different cells. Supply the changed values so that you can view the comparisons side by side.

Check the affordability

If you want to stay away from the foreclosures it is good to consider the future expenses when deciding on the principal amount. One third of your monthly income is what known as affordable monthly payment. Make sure your monthly mortgage payment does not exceed this limit. Change the principle amount in the above formula and recalculate until you get the affordable price. These prior mortgage calculations can help you to get succeed with your mortgage program.


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