Close Topic Options

How Is Mortgage Interest Calculated?

How Is Mortgage Interest Calculated?
Foreclosure Issues

Name: Nesat

Comments: How is mortgage interest calculated? A friend and I were comparing each of our mortgage bills and were a bit puzzled.

Calculated Interest Mortgage How

It depends on what you are calculating exactly. Here is a list that you might be interested in:

Amortization Calculator
Monthly Housing Payment
Mortgage Loan Qualifying
Loan Deferment

Monthly Loan Payment
Loan Amortization
Estate Tax Calculator
Tax Deferred Calculator
Armey Tax Calculator

Roth vs. Traditional IRA

Mortgage Prepayment
How Much Mortgage
Balloon Mortgage Loan

Simple Savings Calculator
Millionaire Calculator
Rent Vs Buy

Income Required for Mortgage Calculator
ARM vs Fixed
Blended Rate Mortgage Calculator


Home Lease Calculator
Compound Interest
Mortgage Loan Cost

Mortgage Payment
Loan Prepayment
Bi-Weekly Mortgage
Home Down Payment
Down Payment Assistance
After Tax Interest Rate Calculator

Investment Mortgage
Credit Score
How Wealthy Are You Now
Retirement
Nominal vs. Effective Rates
Mortgage Point Calculator

15 Vs 30
Mortgage Refinance Breakeven Calculator
Maximum mortgage
APR Calculator
Your Mortgage In Detail

How Is Mortgage Interest Calculated? History & Civil Business Politics

Mortgage interest calculations are very different from interest calculated on credit cards. Credit card interest is calculated monthly. While the rate quoted often is 24% because it is calculated monthly the real interest rate can be a lot higher. This is due to the componding effect of interest rates.

Mortgage interest is calculated semi-annually not in advance, in other words every 6 months. This results in a more accurate interst rate. If you have a rate of 6% you are paying close to 6 percent Why not exactly 6% ? Because, every 6 months the interest is calculated rather than every 12 months. The amount owing after 6 months ie: June30th will be lower than it was on January 1st.
This keeps the componding effect to a minimum and allows you to pay off your mortgage in the specified number of years.
You may find it interesting to know that in Japan they have such large mortgages that they are amortized over 99 years. You could buy a house and it would only be paid off by the time your grandchild is ready to retire. Scary, huh?

Calculated Interest Mortgage How

Name: Stal
Country:

Comments: Thank you so much for providing these mortgage calculation tools. I've been looking for a place to find all in one place rather than visiting various sites to get the same thing done. The "Blended Rate Mortgage Calculator" was particularly helpful to me.