The easiest way to calculate a home mortgage is to use the simple calculator available through such organizations as Bankrate. There are only three fields to enter: the amount of the mortgage (the purchase price less the down payment), the interest rate and the term of the mortgage in years.Continue Reading
The payment that the simplest method provides is not going to be completely accurate. Property taxes, homeowner's insurance and private mortgage insurance premiums are part of many mortgage payments, so using a slightly more advanced calculator, such as the one available from CNN Money, yields a more precise answer.
Once the user knows the property taxes and has received an estimate for insurance premiums for a home, he can enter those items into the fields provided. If the lender requires private mortgage insurance, or PMI, there is a field for that as well. After entering all of that information, the user should calculate the payment. Advanced calculators break the answer down into principal and interest, taxes, homeowner's insurance and the private mortgage insurance premium, as stated by CNN Money. Understanding how a purchase price breaks down into monthly mortgage payments is crucial for helping people make the best home buying decisions.Learn more about Credit & Lending