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Free mortgage calculators are computer programs that compute mortgage-related calculations. They are exclusively found online, linked to websites dealing with mortgages and related information. They are mainly used to find out the amount that would have to be paid monthly while taking a mortgage. After applying current interest rates, the monthly payment can be calculated. A multiplication of this monthly payment with the number of months the mortgage is taken for gives the exact amount of payment done for the mortgage. This calculation gives a clear picture of how much more the person taking the mortgage will have to pay.





The first step is finding a good online free mortgage calculator that analyzes your specific financial situation. The basic types of mortgage calculators needed are straight amortization, point comparison, 15-30 comparison, and debt-to-income and pre-qualify amount. Look for ease of use and simple reporting in easy to understand terms. A good free online mortgage calculator provides more than just the monthly payment; it lets you know the total interest paid over the life of the loan and analyzes debt-to-income ratio. The calculation is done based on the amount you want to borrow, interest rate and length of loan, usually in years. The basic online amortization mortgage calculator simply takes the data and returns the payment schedule.





The debt-to-income calculator is extremely useful because it helps you understand how much money lenders will let you borrow. You need to enter your gross annual income including salary plus bonus, interest and dividends, child support and so on. After that you can enter all your debt obligations, which is comprised of proposed annual taxes, annual homeowners insurance, monthly credit card payments, car loans, any monthly medical bills and so forth including approximate tax and insurance cost. Lastly you enter the interest rate you think is reasonable as well as the tenure of the loan.





Online mortgage rate calculators are more detailed can also display amortization charts with payments to be done on a monthly basis. The basic intention behind using mortgage rate calculators is to show how much of the monthly payment goes towards the principal and how much goes towards payment of interest and taxes. There are various columns such as payment on principal, payment on interest, and so on. Some online mortgage rate calculators can present the information in a graphical chart format to enable better understanding.





These are essential tools used by financial institutions that provide mortgages. With a few clicks, they are able to compute monthly payments from their clients. Even people approaching banks or other financial institutions for mortgages can verify their payments on this software program. If you want to refinance or buy your first home and needed a mortgage calculator, you need not worry because these calculators are basically the same.





Understanding how your mortgage works is the key to getting it at the best available price. What you will be paying will depend on the size of the mortgage, the number of years over which it is going to be repaid, and the interest rate applied. The free online mortgage calculator helps to connect these diverse factors and enables you to choose a deal that is best suitable to your individual circumstances.