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Posts Tagged ‘Mortgage Calculator’

The internet is brimming with mortgage calculators that help borrowers calculate their monthly repayments, and what proportion of those payments actually pay off the loan and not just the interest. These mortgage calculators differ to some degree and finding the right one to tell you everything you need to know about your repayments can be quite a mission. If you want to be more in control of your finances, financial experts are advising mortgage holders to create their own mortgage calculators using Excel.

There are several online tutorials for creating a bespoke mortgage calculator using Excel. The tutorials show the viewer step by step how to make a fixed rate loan repayment calculator using a spreadsheet. Once you have formulated the spreadsheet you can calculate how much you are paying on principal, interest and how much money is then left on the loan. To get the monthly calculations, the first cells that need to be formatted are the total loan amount, the yearly interest rate, the term of loan in years, the monthly payment due on the loan and the monthly interest rate  because this is the frequency of the repayment.

Under this there will be five columns of calculations that show repayment amount (which will be the same for each month because it is for fixed rate mortgages), the principal amount (which you will see gradually increase over the months), the interest (which will gradually decrease over the months), the beginning loan balance and the end loan balance. The tutorial demonstrates how to format the cells in a step by step process to create a mortgage calculator that shows exactly how much you will be paying off your loan over the coming years, and it can be tailored to show how these payments could change when switching to another mortgage deal. Bespoke mortgage calculators of this description mean that as a borrower you can be more in control of your finances than ever, and know exactly how good a new mortgage deal really is before you commit to their terms.

So, you’ve decided you want to buy a house in London, and you’ve started looking around. Five bedroom Chelsea townhouse, plush studio apartment in the West End and a bohemian warehouse conversion in the East End have all caught your attention, the problem is, you probably have no idea what is affordable on your income. The best way to find out what properties are purely a pipedream and which are a potential home is to use an online mortgage calculator.

Mortgage brokers and high street lenders use a complicated formula to decide what repayments they think a borrower can afford, but you need to know what London properties are within your reach before you begin to apply for a loan, or you risk damaging your credit rating. There is no simple way of matching house price and income and knowing what deal you’ll probably be able to strike with a lender, as there are many subtle factors involved in the formula.

These factors are inherently built into a mortgage calculator and are worked out once you have entered the relevant information. There are several types of mortgage calculator, some more detailed than others. The simplest ones only require that you input house price, size of loan required and the interest rate that mortgage is offered at. This will then calculate a monthly repayment, but it is no indicator of whether or not you could actually qualify for that loan.

To know what mortgages you might qualify for you will need to use mortgage calculators that factor in your credit rating, you’re available monthly budget, current income, size of downpayment and the length of loan term in addition to house price, interest rate and loan size. This will give a far more accurate indication of whether or not your financial situation will secure you the mortgage you want. It is essential to remember however that the results shown on mortgage calculators are only as accurate as the information you put in, so get your figures straight to begin with and you might just find you can afford that dream home after all.

Londoners have had their fingers burned in the past with mortgage repayments, and for many people wanting to get on the property ladder, the thought of repossession is real ordeal. To help calculate likely repayments before applying for a mortgage, it is now possible to use a mortgage calculator. Most mortgage calculators offer a couple of simple calculations based on current interest rates and worse case scenario interest rates. These figures are of course invaluable for anyone who is considering getting a variable interest rate or tracker mortgage.

All you need to do is put in the total mortgage you require, which is typically 80% LTV, the repayment period, and the interest rate of the mortgage deal you are interested in. The mortgage calculator will then offer four figures based in this information. The first figure shows monthly repayments on the chosen interest rate, the second is the amount that is interest only; the third figure is what repayments would be if interest rates increased, for example to 12%, and the final figure is once again what the interest rate of that amount would be.

There are mortgage calculators that take many other factors into account, such as financial background, CCJs, credit history, employment status, etcetera, to help identify a person’s eligibility for different types of mortgages. This can make the process of applying easier as you’ll easily be able to see what deals are available according to your personal financial circumstances. Of course, any of the figures obtained using a mortgage calculator are only a guide, and prospective buyers should seek the guidance of a professional broker or mortgage advisor for definitive figures and loan availability.

For buyers in the London area, it is essential to also weigh up the return on investment as well as the repayments. The housing market in the capital, although linked in with countrywide trends, has a tendency to show steeper changes in market values and availability, which can impact on an individual’s future finances. Although these figures may not vary dramatically from national trends, they could make all the difference when it comes to keeping up mortgage repayments on a property, and avoiding repossesion.