Use our mortgage calculator below to start your house hunting!
Part of getting started is to figure out exactly what you can afford. With our mortgage calculator, you can try different scenarios to see what type of mortgage would work best for you and your family. While you are always eager to get a low interest rate and purchase your home for as low a price as possible, we understand that the monthly payment is the number that will seem most real to you.
"How much will my home cost each month?"
Our mortgage calculator will help you get an idea of what that monthly payment will look like. Start with the year in which you plan to make your first payment (usually the current year), and enter the amount of the loan. Next, enter the interest rate that you anticipate receiving. This can range from 5% to 9%, depending on your credit, the type of mortgage you receive, and other factors that impact your borrowing power. Enter the interest rate as a whole number and decimal, e.g. 7.5 for 7.5%.
Then, select a loan term; this is the number of years over which you would repay the mortgage. Most people tend to opt for a 30-year mortgage, but try a few different mortgage terms. You may be surprised at what you can do! Your payment frequency is set to monthly, as this is how most mortgages are structured.
Click "Calculate" to determine what your monthly payment will be. Your monthly payment amount will appear in the box below the "Calculate" button. You also will see an amount for "Total Interest Payments". This is how much you will pay in interest during the life of your loan - i.e. payments that do not go to paying for the loan's principal. A lower interest rate and shorter loan term will help reduce the Total Interest Payments amount.
Click on the "Amortization" button to see how your payments will be applied every year. At the beginning of your mortgage, most payments cover interest, establishing little equity in your home. Over time, though, more of your payment goes to establishing reducing the loan amount, meaning that you own more of your home. The last year of course, you see the Balance equal zero. Congratulations!
Do this a few times, with different loan amounts and interest rates, so you can get a feel for the range of possibilities. Use different scenarios to understand what a lower - or higher - interest rate will mean for you through the life of the loan, and work with different loan terms to see how shorter mortgages establish equity more quickly.
Remember, the mortgage calculator is just a guide. Keep in mind that you still have to pay closing costs, and your mortgage may include real estate taxes every month and condo fees (if applicable). Use the mortgage calculator as a guide to get started, and work with our professionals to understand what your final payments actually will be.
