This **home loan calculator** figures your monthly payment together with all the details such as total interest paid or the estimated payoff date. There is in depth information about the types of home loans below the form.

## How does this home loan calculator work?

This is a handy and flexible loan calculator that allows the payment simulation of any home loan by a fixed term and interest rate. It is based on following details that should be provided:

- Loan amount which is the value to be borrowed.

- Loan term meaning the time negotiated to pay back the principal plus the cost of the loan as it is stated within the contract signed with the bank or the lender.

- Annual interest rate which is a fixed average interest rate assumed as the cost of the money borrowed.

- Payment frequency which can be chosen from the drop down list either as monthly, weekly, bi-weekly, bi-monthly, quarterly, semi-annually or even annually. It should be chosen by taking into account the affordability to pay within a certain period of time.

- Assumed loan start date which is the planned date to borrow money. It represents the calendar date the repayment phase will start according with the agreement’s amortization schedule;

- Generate amortization schedule is a quick way to receive the detailed payment plan.

The algorithm of this *home loan calculator* uses the compound interest formula as it is explained in the next lines:

- For a weekly frequency:

Regular payment = Principal*[(1+((r/52)/100))^(52*n)].

- For a bi-weekly frequency:

Regular payment = Principal*[(1+((r/26)/100))^(26*n)]

- For a monthly frequency:

Regular payment = Principal*[(1+((r/12)/100))^(12*n)]

- In case of bi-monthly frequency:

Regular payment = Principal*[(1+((r/6)/100))^(6*n)]

- In case of quarterly frequency:

Regular payment = Principal*[(1+((r/4)/100))^(4*n)]

- In case of a semiannually frequency:

Regular payment = Principal*[(1+((r/2)/100))^(2*n)]

- In case of annually frequency:

Regular payment = Principal*[(1+(r/100))^(2*n)].

Where: “r” is the interest rate and “n” is the term in years.

The application displays the main details someone would be interested in:

- Regular payment value;

- Total paid for the loan (principal + interest paid);

- Total interest paid;

- Term;

- Average interest rate;

- Frequency of payments;

- Estimated payoff date which is the date to be debt free.

- Amortization schedule (if requested) – the table can be open by simply entering the blue button.

## Example of a calculation and its result

In case of a loan of $150,000 with a fixed interest rate of 3.75%, taken over 20 years with monthly payments will result the following figures:

■** Monthly payment: $889.33**

■ Loan amount: $150,000.00

■** Total Paid: $213,439.79**

■** Total Interest Paid: $63,439.79**

■ Loan term: 240 months

■ Annual Interest rate: 3.75 %

■ Payment frequency: Monthly

■** Payoff date: December, 2034**

## What is a home loan?

It is a financial product that depending on the way the money borrowed are used can be either:

- An agreement between the lender and the borrower by which the money are borrowed to buy a home or change a current loan on a house. This is also referred to as
*mortgage*loan or*remortgage*loan. - An agreement by which it is used the value in your home to raise finance for a specific plan such as consolidate debts or purchasing a new car. It is sometimes referred to as home finance.
- An agreement that refers to an
*equity release*which represents a scheme that allows you to raise cash in exchange for a percent of the equity in your home value.

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