Mortgage News
As with other types of loans, mortgages carry a certain interest rate, which is scheduled to amortize over a set time frame, usually 30 years. With a fixed-rate mortgage, the interest rate stays the same throughout the life of the loan, and so does the monthly payments borrowers make towards their mortgage. A 15-year fixed-rate mortgage has higher monthly payments (because you are paying the loan over 15 years, rather than 30), but over the course of the life of the loan, you could save thousands on interest. A 30-year fixed-rate mortgage has lower monthly payments, though you will pay more interest over the course of the loan.
Extra payments applied directly to principal at the beginning of the loan can shave years from a 30-year loans lifetime. If the homebuyer chooses to take out a 30-year loan, the majority of his or her initial payments will be applied toward the interest payments of the loan.
If a borrower stops making payments on their loan, the lender may foreclose on the property. A mortgage is a loan a borrower uses to buy or hold onto a house or other real estate, and agrees to repay over time, usually through a series of regular payments. A 30-year fixed-rate loan is the most common in the U.S., but with this centurys economy experiencing a boom-and-bust cycle, buying a smaller house on a 15-year mortgage may make more sense. For instance, if you are buying a house, you may opt for a 30-year mortgage, the most common, because that allows you to lower your monthly payments while spreading out your payment term across three decades.
A 20% down payment will also let you avoid paying private mortgage insurance on the loan. If your loan requires other types of insurance, such as private mortgage insurance (PMI) or homeowners association (HOA) fees, those fees can be included in your overall mortgage payment as well.
Zillows Home Loan Calculator breaks down the annual premiums by 12 months to adjust your monthly mortgage payments. Use Zillows home loan calculator to quickly estimate your total mortgage payments, including principal and interest, as well as estimates of your PMI, property taxes, homeowners insurance, and HOA fees. If you are shopping for a mortgage, online mortgage calculators can help you compare estimated monthly payments, depending on what kind of mortgage, what interest rate, and how big of a down payment you are planning on making. This calculator takes in your home price, mortgage interest rate, loan length, and down payment, and estimates monthly payments you can expect to make toward both principle and interest.
Use Bankrates Mortgage Calculators Extra Payment feature to see how you can reduce the length of time you have to live on a mortgage, saving more in the long term, by paying extra toward the loan principal. That means that the bill you get every month for your mortgage includes not just your principle and interest payments--money going straight into your loan--but property taxes, homeowners insurance, and, in some cases, private mortgage insurance.
