Most people have to borrow money to buy their homes. A mortgage with a fixed interest blocks the interest rate during the life of the mortgage. To calculate the amount of your payments, you’ll need to know the interest rate, the time of the loan and the amount you asked.

  1. Determine the amount you need to borrow for your mortgage.
  2. Determines the time your loan. Most mortgages are 15 to 30 years. The longer you take time to pay, lower loan will be your monthly payments, but pay more interest over the life of the loan.
  3. Determines the interest rate you’ll pay. If you have approved a mortgage, the lender will set the rate based on your credit worthiness, your income and many other factors. Lenders typically offer lower for short – term lending rates and people with good credit. If you’re doing a comparison of mortgages, lenders make their rates and time limits are readily available.
  4. Determine the periodic interest rate by dividing the annual interest rate by 12. For example, if the annual interest rate is 7.5%, the periodic interest rate will be 0.625%.
  5. Indicates the number of payments you will make during the life of the mortgage by multiplying the number of years by 12. For example, if you have a mortgage for 30 years, you will make 360 ​​payments.
  6. Add one to the periodic interest rate. For example, if the periodic interest rate is 0.625%, or 0.00625, 1.00625 get.
  7. Raises the value of step six to the negative power N, where N is the number of payments to be made during the life of the mortgage, found in step 5. For example, if the number of step 6 was 1.00625 and hast done 360 payments, calceolarias 1.00625 ^ -360 and you would get 0.106139829.
  8. Subtract the value from step 7 1. For example, if your value is 0.106139829, 0.893860171 get.
  9. Divide the periodic interest rate by the number obtained in step 8. For example, if the periodic interest rate is 0.00625 and the step number 8 is 0.893860171, 0.006992145 get.
  10. Multiply the result of step 9 by the amount you borrowed to calculate your monthly payment. For example, if you borrowed $ 300,000 US $ 300,000 US multiply by 0.006992145 for US $ 2.097,64 as your monthly payment.

Tips & Warnings

  • You can also calculate your monthly mortgage payment using the following formula where P is the principal of the loan, I is the periodic interest rate, N is the number of payments you will make the loan.
  • Payment monthly = P (I / (1 – (1 + i) ^ – N))
  • For example, if you have a 30 year mortgage at 7.5% $ 300,000, your monthly payment will be US $ 2.097,64.
  • The majority of lenders prefer that your monthly payment does not exceed 28% of your monthly income.
  • Lenders also take into account other debt obligations you have as student loans or car. Your total debt payments normally cannot exceed 36% of your income.
  • You must consider your closing costs, the amount you need for repairs of your house and the amounts required to place a deposit for house insurance and for real estate taxes when determining the amount you need to ask borrowed. Your deposit, and sometimes your closing costs can be attributed within your total monthly amount and payment of interest.