Online Mortgage Amortization

Amortization refers to the method used to calculate the principal, interest and payments of a mortgage.

Calculating the amortization can show you how much you will pay in a mortgage. It will also tell you what the payments and interest will be.

Years ago people had to buy special calculators if they wanted calculate mortgage amortization. Today there are a wide variety of websites that can help a person calculate mortgage amortization online. Online mortgage amortization can show you what you will pay in a mortgage.

Online Mortgage Amortization Calculators

There are lots of online mortgage amortization calculators that enable people to determine what their mortgage amounts will be. Amortization calculators can be found on a wide variety of websites. There are also websites that combine amortization calculators with amortization tables and other mortgage calculation tools.

An amortization tables is a chart that shows the mortgage rates and the APR for the most common mortgages. An amortization table is a useful too because it shows you the numbers needed to calculate mortgage amortization. 

How an Online Mortgage Amortization Calculator Works

An online mortgage amortization calculator is a very easy device to use. You just type the amount of the mortgage you want, the number of payments you intend to make and the interest rate into the spaces provided.

You arrive at the number of payments by multiplying the number of years of the mortgage by twelve. For example a 30 year mortgage would have 360 payments.

The mortgage calculator then determines the amortization. The amortization of a mortgage is the principal of the loan plus the interest divided by the number of payments made. For example the payments on a 30 year mortgage for $110,000 would be equal to 559.50.

Some mortgage calculators also have features for adding extra payments such as private mortgage insurance. These can increase the amount of a mortgage.

Mortgage Amortization Calculation

It should be noted that online mortgage amortization calculators can not be used for calculating payments on Adjustable Rate Mortgages or ARMS or floating rate mortgages. Mortgage amortization calculators work only with fixed rate mortgages. In a fixed rate mortgage the interest rate stays the same throughout the history of the mortgage.

Online mortgage amortization calculators can’t be used for ARMS or floating rate mortgages because the interest rates on these mortgages can be changed during the duration of the mortgage. This means that an accurate calculation can’t be made because the future mortgage rate is unknown.

 Mortgage amortization can only be calculated when the interest rate is known and fixed. This is another reason why fixed interest rate mortgages are always a better deal for the average person.