There’s nothing worse than thinking you understand your potential mortgage payment, only to discover that it will be much larger than you planned! Your mortgage is likely your most significant monthly financial commitment. Is there a way to estimate it early in the loan approval process to help you make the best real estate decision?
A mortgage calculator might be your answer. Mortgage calculators have come a long way, and the latest versions account for nearly all of the expenses related to your real estate purchase.
How Do Mortgage Calculators Work?
Calculating a monthly mortgage payment is a complicated process that most borrowers would rather avoid. Online mortgage calculators help even the most mathematically-challenged borrowers figure out their monthly payments with relative accuracy.
If you Google “mortgage calculators,” you’ll come up with a million different options. The best ones take the following information into account:
- Home price
- Down payment
- Loan term
- Likely interest rate
- Buyer’s credit score
- Property taxes
- Homeowner’s insurance cost
- HOA fees (if applicable)
Mortgage calculators take the information you input and do the mind-boggling math to determine your monthly payment.
Finding a Mortgage Calculator
Not all mortgage calculators are created equal. As you’re sifting through your Google results, look for these characteristics in a calculator:
- For the most accurate reflection of your monthly payment, select a calculator that requires the information listed above.
- If you are a math junkie, search for a mortgage calculator that offers a step-by-step explanation of the algorithm.
- Choose a mortgage calculator from a reputable website. Lenders often offer them, or you can check the major real estate search engines.
How Accurate Are Mortgage Calculators?
Mortgage calculators are pretty dependable, but they have some limitations that affect their accuracy. As you use one, keep these things in mind:
- Some mortgage calculators only figure out the principal and interest payments while ignoring taxes, insurance and HOA fees.
- Every calculator’s accuracy depends on the information you provide.
- Mortgage calculators don’t consider the up-front costs of buying a home.
Contact Us Today!
Do you have homebuying anxiety over using a mortgage calculator on your own? Contact MortgageDepot today for an accurate estimation of your monthly mortgage payment!
Connect with one of our loan consultants today to learn more!