The Total Interest for a mortgage is the sum of all interest paid over the life of a loan. Interest Rate The percentage of the principal balance of your mortgage that determines how much interest you must pay. The interest rate on your mortgage may change or remain the same depending on the type of loan you have.
30 Year Fixed Rate Mortgage Amortization ExampleThe 30 year fixed rate mortgage tends to be the most popular type of home loan because it offers monthly payments that are predictable since the stays the same over the life of loan and more manageable since they are amortized over 30 years.In this example, we compare the amortization schedules for a $300,000 40 year fixed mortgage at a 4% annual interest rate to a 30 year fixed mortgage at 3.5%. After reviewing this example, enter your desired mortgage amount and term into the to see how the principal and interest change over time and help you decide which mortgage best meets your needs.
This 30 year fixed has a monthly payment that is approximately $559 lower than the 15 year fixed. However, the 30 year fixed would require you to pay approximately $101,428 more in total interest over the life of the loan. If you keep the mortgage for 7 years before refinancing or selling the home, you would pay approximately $20,170 more in total interest for the 30 year fixed. As you can see, the length of time you plan to keep your mortgage can have a real impact on which type of mortgage will be most appropriate for you.Note how little the principal balance changes in the early months of the mortgage and how much of it changes in the final years of the mortgage. This is why made early on can result in great savings.
Mortgage Calculator - Help Amortization Schedule The amortization schedule show you how monthly principal and interest payment and principal balances change over the life of your loan. Interest The portion of your mortgage payment that is due to the interest rate being applied to the principal balance.
The Total Interest for a mortgage is the sum of all interest paid over the life of a loan. Interest Rate The percentage of the principal balance of your mortgage that determines how much interest you must pay. The interest rate on your mortgage may change or remain the same depending on the type of loan you have. Loan Amount The initial principal balance or your mortgage at closing. Principal The portion of your mortgage payment that is used to pay down the current balance of your mortgage. The principal balance represents how much you owe on the mortgage.
Term The amortization term is one of the key factors that determine your required mortgage payment. Your required mortgage payment for fully amortizing mortgages is the amount that would result in the mortgage being closest to being paid off by the end of the amortization term. Longer amortization terms result in lower required mortgage payments for fully amortizating mortgages, all other things being equal.