If you are currently a prospective homeowner and ready to find the best mortgage for you, then consider using our mortgage calculator. Utilizing this tool can help to analyze a variety of variables of a mortgage to assist you in finding the right fit. The following will provide you with more information about the functions of mortgage calculators.
How Mortgage Calculators Work
Mortgage calculators allow you to figure out how much you can afford when it comes to purchasing a home. First, you must input variables such as asking price, interest rate, amortization, heating per year, taxes per year, and condo fees per year. By entering this information, a mortgage calculator uses complex formulas to determine your costs and requirements to qualify for a mortgage.
How Mortgage Calculators Are Helpful
When you input all of your pertinent information, a mortgage calculator can provide you with very helpful results. Depending on what kind of down payment you choose (5 or 10%), a mortgage calculator can give you a breakdown of your monthly costs or requirements. Some of these variables include:
- The amount of your down payment
- First Mortgage
- Insurance (CMHC/GE)
- Total Financing
- Principal and Interest payment
- Condo fees (if applicable)
- Total Expenses
- Income requirements
Mortgage calculators are helpful because of their simplicity and widespread availability to all. Before mortgage calculators, one had to use compound interest rate tables that required a working knowledge of finance and compound interest math.
How To Use Mortgage Calculators In Your House Hunting Process
While you are house hunting or when you’ve found your perfect home, a mortgage calculator can be of great assistance during the process. This tool allows you to visualize your monthly payments and compare different mortgage options. A mortgage calculator can help you to understand the breadth of your financial obligations prior to signing your loan. It can allow you to become more comfortable with the repayment terms before you commit to the best mortgage for your circumstances.
Another way to use mortgage calculators during your house hunting process is to formulate a pros and cons list. Since a mortgage calculator is readily available at your fingertips, you can access it at anytime. This allows your the freedom to create your pros and cons list whenever you desire. You can compare mortgage lengths, terms, interest rates, down payments, and other variables to help you make the most informed decision.