For the vast majority of home buyers today, the 30 year fixed mortgage is the product of choice. With the longer term of the loan, the payments are relatively low, and the interest rate is only slightly higher than the 15 year fixed or the ARM (adjustable rate mortgage) options.
However, looking closely at a 30 year fixed rate mortgage calculator, particularly if it allows you to compare the same loan with a 15 year fixed rate, is a very useful exercise. As these calculators do the math for you, it is a quick way to contrast and experiment with various options and see how they meet your financial reality.
Variables to Consider
When looking at a standard 30 year fixed rate mortgage calculator or one that allows you to compare the short and long-term loan options, always look for a system that allows you to control many of the variables for the loan.
These will include the interest rate, which will vary based on what the lender offers a given applicant. Good credit scores, a solid employment history and a low debt to income ratio will provide the best credit score.
The loan amount, as well as the term, will be important. While there are lower overall payments over the 30 year fixed, there is also more paid in interest per month and over the term of the loan. This means a higher overall cost of the loan and a slower accumulation of equity in the property.
In addition, the 30 year fixed rate mortgage calculator should allow you to add additional costs and charges, the settlement fees as well as insurance payments and property taxes. The more information that can be selected and added by the buyer, the more accurate the results will be for a given home purchase.
To try our 30 year fixed rate mortgage calculator and compare to a 15 year fixed loan, visit us at www.guaranteedrate.com. You can also talk to our expert lenders or start your application through the online application offered by Guaranteed Rate.