A mortgage is a loan that you take out to buy a home. When you buy a home, the lender lends you money to make up for the difference between your down payment and the total amount of your purchase. The borrower agrees to pay back the total amount of the loan with interest over time after paying off their initial down payment. A mortgage calculator can be used to establish how much money you need in order to buy a home with your desired monthly payment.
Mortgage calculations are very important in determining what type of house one can afford. The size and style of a home will affect this calculation; however, mortgage calculations are also dependent on the interest rates of loans. There are many different types of loans that exist today that have varying interest rates. To get an idea of how much one can afford, it is best to consult with a mortgage broker who understands these factors.