Mortgage Calculator

Using a mortgage calculator can help you estimate your future mortgage payments and understand how different variables, such as interest rate and down payment, can impact your borrowing costs. Using a mortgage calculator can be a valuable tool for anyone looking to purchase a home or refinance their mortgage, as it can provide insight into your borrowing costs and help you make informed decisions about your finances.

• Principal: This is the amount of money you borrow to purchase a property. You repay the principal over the term of the mortgage, typically 15 to 30 years.


• Interest: This is the cost of borrowing money, and it is charged by the lender as a percentage of the principal. The interest rate can be fixed or variable, and it can have a significant impact on your monthly mortgage payments and overall borrowing costs.


• Taxes: Property taxes are assessed by local governments and can be paid separately or included in your monthly mortgage payment. The tax amount is usually a percentage of the assessed value of the property.


• Insurance: Mortgage lenders typically require borrowers to have homeowners insurance to protect the property against damage or loss. Depending on the location of the property, flood insurance may also be required.


• Private Mortgage Insurance (PMI): If your down payment is less than 20% of the purchase price of the property, you may be required to pay for PMI. This is an insurance policy that protects the lender in case you default on the mortgage.


• Escrow Account: An escrow account is an account managed by the lender that holds funds for property taxes, insurance, and PMI (if required). The lender collects a portion of these expenses as part of your monthly mortgage payment and then pays them on your behalf when they are due.

Mortgage interest rates change due to a variety of factors such as inflation, economic growth, central bank policies, global events, and demand for mortgage-backed securities. When inflation is high, central banks may increase interest rates to control it, which can lead to higher mortgage rates. Similarly, when the economy is growing rapidly, demand for loans may increase, leading to higher interest rates. Global events such as political instability or natural disasters can also affect interest rates. Lastly, the demand for mortgage-backed securities in the market can impact interest rates as well.

Anything below 5% growth is considered a good mortgage interest rate. Below 3% is a great interest rate.

Generally, it is recommended that your monthly payment may not exceed 25% of your gross income. If your monthly housing payment is above 25%, it may become hard to pay all your bills each month.