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How do I calculate my monthly mortgage payments?

Curious about Home Affordability

How do I calculate my monthly mortgage payments?

To calculate your monthly mortgage payments, you need to consider the following factors:

1. Loan Amount: The total amount of money borrowed to purchase the property.

2. Interest Rate: The annual interest rate that the lender charges for the loan.

3. Loan Term: The number of years it will take to pay off the loan.

4. Down Payment: The amount of money you pay upfront towards the purchase of the property.

Once you have these factors, you can use a mortgage payment calculator or a formula to calculate your monthly mortgage payments.

Here is a formula you can use:

Monthly Payment = (P R) / [1 (1+R)^(N)]

Where,

P = Loan Amount

R = Monthly Interest Rate (annual interest rate divided by 12)

N = Number of Monthly Payments (loan term multiplied by 12)

For example, if you have borrowed Rs. 50 lakhs for a 30year fixedrate mortgage at an interest rate of 8%, your monthly payment would be:

Monthly Payment = (50,00,000 0.00667) / [1 (1+0.00667)^(360)] = Rs. 36,347.89

Note that this formula only calculates the principal and interest portions of your monthly payment. Your actual monthly payment may include additional costs such as property taxes, insurance, and homeowner's association fees.

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