The Comprehensive Guide to Our Mortgage Calculators (Part 1)

Whether you are new to mortgages or you have taken out a mortgage before, you probably realize how complex and confusing they can get. A large amount of information goes into a home loan, and to fully understand the financial commitment of a mortgage, you need to do more math than most people are comfortable with. That said, it would be terrible if the level of complexity involved kept you from considering buying a home.

To try to take some of the mystery, work, and complexity out of the mortgage process, the Local Mortgage team based in Colorado developed mortgage calculators for you to use. We hope that these mortgage calculators will help you understand your mortgage and that you will choose us when you purchase a home in Colorado. In today’s blog, we will begin our comprehensive guide to our mortgage calculators by explaining how to use our mortgage payment calculator.

The Goal of the Mortgage Payment Calculator

In order to gain a full understanding of how to use any tool, it is best to first understand the purpose or goal of the tool. This is also true for understanding our mortgage calculators. While all of the mortgage calculators we have developed for you to use share the goal of improving your understanding of mortgages, each calculator is intended to add to your understanding in a different way.

The purpose of the mortgage payment calculator is to provide you with a clear picture of what your monthly financial situation might look like if you were to take out a mortgage. To this end, it allows you to adjust details to meet your specific situation. The calculator uses these details to not only show you how much your monthly payments will be, but also create a graph showing those payments over time.

The Things You Can Adjust

Each of the calculators from Local Mortgage allows you to adjust crucial mortgage details to make the calculator provide a clearer picture of your situation. On our calculators, these details can either be adjusted with the sliders on the calculator page or by typing in the boxes above the sliders. This makes it simple for you to change multiple things at once to see how vastly different mortgages compare with each other.

The adjustable sliders in our mortgage payment calculator include the following:

• Home purchase price - the price of the house or property you are thinking about buying

• Down payment - how much money you would contribute to your mortgage upfront

• Annual Property tax - the expected property tax to be collected on the property you wish to buy

• Monthly HOA dues - the monthly cost of homeowners association fees in the neighborhood your house is in

• Annual home insurance - the annual cost of insuring the new house

• Loan term - the number of years your mortgage includes

• Interest rate - the interest rate on your mortgage

While mortgages may include other important details and costs, these sliders provide the crucial information for determining the monthly cost of a new mortgage. By using them, you get a good picture of how a mortgage might change your financial picture and whether one could be good for your future.

The Information It Gives

Once you have adjusted the calculator’s sliders to represent the mortgage details you would wish to see analyzed, the calculator will automatically update with new information. In the case of our monthly mortgage payment calculator, this information is the information essential to your monthly mortgage payment. This includes the total mortgage payment each month as well as the components (such as monthly home insurance or principal and interest paid) of that monthly payment.

Our calculator also generates a table for the mortgage’s amortization schedule. This table gives a monthly breakdown of how much interest and principal will be paid on the mortgage for each month over the loan’s entire term. The amortization schedule provided by our calculator is an extremely powerful tool to help you analyze mortgages.

The mortgage payment calculator also generates a loan payoff schedule visualization, which is a simple way to see how much debt a mortgage would put you in. The graph shows how the debt you would owe would need to be paid off over time. This gives you a good idea of how your monthly payments will affect the total amount you owe.

Conclusion

At Local Mortgage, we pride ourselves on taking the complexity and confusion out of mortgages so that you can get into your dream house with a clear mind. We hope that you feel confident using our mortgage payment calculator after reading today’s guide. The calculator is a powerful tool and it is here for you to use at any time.

Moving forward, look out for part two of our guide to our mortgage calculators. It will focus on using our renting vs. buying comparison calculator. Feel free to contact Local Mortgage if you have any further questions about mortgages or would like to start the home-loan process today!