Do you remember the good old days of simple interest when you did not need a home mortgage calculator? Where every payment paid the same amount of interest and principal until the last payment? Sure made calculating a home mortgage loan simple to understand and easy to calculate.
But wait! This is the 21st century. Today we have loans with adjustable rate mortgages, first-year payments containing 75% or more of interest and complex loan calculations that only a computer can love. Do not try these calculations yourself, you are going to need a home mortgage calculator.
One of the most accurate that is available for free on the Internet is Karls Mortgage Calculator available at DrCalculator dot com. It was created by Karl Jeacle and is even protected by a copyright. You cannot buy it. But lenders and mortgage brokers are encouraged to link to the calculator for free on their own web sites.
Using simple slider controls along with graphs and charts you can see how much and how fast you will pay interest and how much and how slowly you will pay down your principal. Karl even put in a great feature that automatically accounts for changes in the inflation rate as reflected in the economy. The calculator also includes great features for computing scenarios including adjustable interest rates, extra payments and prepayments. The calculator is completely interactive and does not require you to reload the page to see the results of any changes you make.
Here are a just a few of the features offered by Karls mortgage calculator:
– The amortization graph shows the amounts of both the interest and principal paid as a portion of the monthly payment for the life of the loan.
– The repayment graph shows you how much you will pay in total interest and total principal expressed both as a percentage and in pie chart format.
– The balance graph shows a curve representing the balance of principal still owed for the life of the loan.
– The interest graph show the annual percentage rate for the life of the loan which is really useful for adjustable rate mortgages.
– The annual table chart shows the amounts paid annually in interest and principal plus the remaining balance for the life of the loan.
– The monthly table chart shows the same as the annual table chart but on a monthly basis.
– The payments chart shows you how extra payments will affect your monthly payment and your balance due.
– The summary chart shows you all the total amounts associated with your mortgage loan.
I highly recommend playing with Karls mortgage calculator as the results can really be eye-popping. For example, consider a fixed-rate loan at 5% for 30 years for a home value of $250,000 starting on January 1st 2011. The monthly payment will be $1,342 with total interest of $233,141 and total payments of $483,138. By reducing the payment period to 20 years the monthly payment is now $1,649 with total interest of $145,973 and total payments of $395,973. Your monthly payment only increases 23%, but your total interest payments decrease by 37%.
I will leave it as an exercise to the reader to try the same loan scenario with a payment period of only 15 years. I think the amortization graph that shows the monthly payment interest paid and the principal paid where the two curves converge will make you seriously consider a 15-year loan period. I am sure you would like to save over $127,283 in interest payments and even own your home in half the time to boot! Try using Karls home mortgage calculator today.