How Can I Determine a Mortgage Payment?

Nov - 16

How Can I Determine a Mortgage Payment?

Mortgage payments depend on three factors –the term of the loan value, the loan and the yearly percentage rate. The formula for mortgage payments would be P = L[c(1 + c)^n]/[(1 + c)^n – 1], where”L” is the loan value,”n” is the whole number of payments over the life of their loan and”c” is the rate of interest for one repayment period. In order to solve this equation using a calculator, then you need to have a financial or scientific calculator that supports exponentiation, which is normally labeled”x^y” on the keypad.

Calculate the period interest and the number of payments to your loan. The period rate of interest is the yearly percentage rate divided by 12 to get a monthly payment program. The number of payments is that the term times 12 to get a monthly program. Example: 30-year $300,000 mortgage, 6 percent APR, monthly payments Stage interest rate: 0.06 / 12 = 0.005 Number of payments: 30 X 12 = 360

Solve the (1+c)^n portion of the issue. Store this value in memory. Example:”MC” (to clear memory) 1 + 0.005 = 1.005 1.005″x^y” 360 = 6.022575″M+” to keep the value

Utilize memory remember (“MR”) and the value saved in memory (m) to calculate the fraction portion of the equation: [c*m] / / [m – 1] Example: 0.005 X”MR” / (“MR” – 1) = 0.005996 If your calculator doesn’t support category symbols”(” and”),” then you can still solve the equation with your calculator’s reciprocal function,”1/x.” Example:”MR” – 1 = 5.022575 5.022575 / / 0.005 / / 6.022575 = 166.79161 166.79161″1/x” = 0.005996

Multiply the result by the loan value to acquire the payment. 0.005996 X 300000 = 1798.65 Payment = 1798.65

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