How To Calculate Your Monthly Mortgage Payment Given The Principal, Interest Rate, & Loan Period
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- เผยแพร่เมื่อ 2 ต.ค. 2024
- This finance video tutorial explains how to calculate the monthly payment on a mortgage given the principal, the interest rate, and the loan period. This video also explains how to calculate the total interest paid over the lifetime of a loan.
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Thank you for this video you're the first person to explain this clearly. I watched other videos and they would leave out some information.😃
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Finely! Now I understand how it's calculated. Thanks so much 🙏
I’m doing a school assignment so this helps a lot!
Nice video , can u pls explain the concept and a proof to this formula(how it was derived)
Hello! in the first step 3:03 when you took 300,000 thousand and multiplied it to the other group
In order of operations, aren't we supposed to solve all the steps in the groups first and THEN do multiplication?
Whew so glad I found Dave Ramsey. No way I’d pay that much extra on a loan. Pay that thang off early as possible
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Remarkable video!
thank you.. i now understand the process.. it helps a lot.
great video
How do you calculate the lower bracket in the second formula?
Do yiu have another tutorial?
What do we do with negative 360?
Where you get the plus 1 and minus 1?
It's just part of the formula
Teachers always give the hard method first
THIS just saved my life!!!! I'm going to be a first time home buyer and wanted more info. I was so lost until your video. THANK YOU!!!
this channel got me through high school and college as a bio major and now it's helping me buy my first home
Annuity is my favorite topic in financial mathematics. I would definitely make some series of financial mathematics in my channel as well. Great job! Showing how math is used in daily lives is so important.
When i try to calculate to the power of 360 total different numbers come out from yours Whats going on????? Ahhhhh my brain is crashing
same did u figure it out
did you finally see what's going on?
i try many ways to obtain the result but doesn't ...... "organic chemistry tutor could give us the solution"
exactly my thought!!!!!! even when google pulls it up... smh... how did he get the 4.467........
I got - 4.467744848
fantastic video!
Can you make videos about Fourier series, they a so confusing
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why the hell usethis formula..?can anyone explain why and how formula works..?why (1+r)^n ????
why top and bottom (1+r)^n but in bottom you have minus 1?
nobody explains it..just like dumb teacher everyone writes it on board and start filling it with numbers..gods sake start explanantion with 'WHY' formula is used rather 'HOW' to use it..
To pay up my mortgage was not really a problem because I did not actually feel it due to how early I did. I had to increase my monthly payment and lowered my principal rate. Thanks to my Forex investment, I had to pay triple of what I paid initially with ease
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I got all that, except when you said raise it by 360. what does that mean?
Feels like I'm back in math class that I hated 😭🤣😒🙄🙄
I'll just use goggle lol
Given m, P & n, can you solve for r using the equations?
Great video
Im confused.. 1 - (1+r) what is the 1 mean?
This is not exact but good approximation. Heres how you do it. Interest paid is based on average loan balance which is the mid point balance (beg + end ) / 2. This average balance multiply by the annual int rate and then number of years and the result is the overall interest paid over the loan period. Add this to original loan balance and then get monthly equal amounts. Thats should be your monthly
Can you explain why the formula works?
my problem with this is does it account for the monthly payments decreasing the mortgage and thus decreasing the interest over time. all of this is based on 5% interest on the principle 300,000 over the entire 30 years. but in 5 years the principle would have decreased and thus interest decrease?
The amount of money that actually goes towards your principal is pretty minor in the beginning of your loan, so paying extra on your mortgage payment in the beginning is actually one of the best things you can do. But your point is still valid and it doesn’t account for the pay down I don’t think
Why my answere is not coming out 4.467744??
What am I doing wrong
I think i js realized u raise it to the 360 power, not just multiplying it
Thank you so much, this video explains things nice and clearly. Please do more videos about economics/money/interest
This was helpful and everything, don't get me wrong, but I feel like you just gave us variables and told us to sub in the values, and that's it. WHY is this the formula for a good loan? I missed that part.
I just want to say thank you thank you thank you sooooo much! This was extremely helpful and truly made the calculations very simple and clear.
Is that you, Mark Wahlberg??
Is there any formula to use and get the answer B ?
Thanks for this... Best explanation I have heard to date... Made it so simple for me...
You missed to specify that you are using compound interest law. Moreover under compound interest law, you cannot calculate monthly interest rate as 0,05/12 which is not equivalent to a 5% annual. Finally, compounding you have higher payments; so why not calculate payments under simple interest law?
Thank you for giving the real answer to understanding this. The only question i have is what does the 1 represent within the equation? Why is it "(1+....."
I belive it means the beginning and ending period of the loan. First and last month. But I could be mistaken.
Yes, I would like to know that part as well. If you could please elaborate on that. I'd appreciate it
Thank you
I don't understand how to calculate the exponential 360
I don't get the 4. Something
I want to understand how to calculate it manually
Great video! Definitely helpful. Especially the full break down. Thank you so much for posting this.
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What about the property taxes ?
This video was amazing
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What is 6 repeating and and how do you raise to 360? I'm not good at math.
Someone could have been tempted to shoot themselves after trying to follow along to calculate the first monthly payment formula in an excel spreadsheet configuration, struggling to get it all in place, finally getting it... then pressing play to hear, "Now let's get the same number with a WAY simpler formula...ready?" Like....WHYYYY??!!! x-o
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for first example of your calculation I do not get 1610.46 using your formula, I get 1250.77. How did you get your number?
What am I missing here. Calculator doesn't even accept raised to power of 360??
Some segments in the video are stamped not adjacent to each other
Sry bro can you tell me which platform are you using if it's not secret
Make a video on how you would punch this in on a fancy calculator
Thank you so much for this, exactly what I needed
As the amount of money owed goes down over time, doesn't the interest? So you can't assume the repayments and interest will be the same throughout the 30 year term?
At 3:18 in the video where you calculate the second part. What function do you press on your calculator to calculate the n(360).
most banks use 365/360, this will get you the wrong answer for a mortgage payment.
Hey may i know why u divide 5%/100 please
The Organic Chemistry Tutor can do it better than my finance management professor. thanks a lot
Bro Ive watched your videos ranging from diff eq to physics to annuity payments #OrganicChemistryGod
Looked all over for this equation, not sure why it came from an Ochem tutor but who am I to complain!
you not showin how you got your answer using the 360
And then you add taxes and insurance and your mortgage could be 2000 dollars easy
let's calculate something I'll never have
😂😂😂
Explain how the interest is frontloaded.
Why is my teacher formula of mortgage payement is different from tutor chemistry...🤔🤔🤔🤔
I love u so much
goodluck to me i have an exam about this tom
Thank you that was so easy to understand
This shit is not in my real estate book. Lol. In my book they are taking the loan and dividing that by 1000, then they take the quotient of that and multiply by a mortgage factor provided on a mortgage factor chart.
So what's YOUR answer for this?
I would like to understand why the math is the way it is. Why is there the -1 in the denominator calculation? Why is there a 1-(monthly INT rate)?
It seems so complicated and I’ve been working for a bank for 13 years 😂
@7% it is over $2k a month😮
Dear sir, you are really a life saver. thanks
So where does 5% come in to play? 5% of what ? 5% of 300,000 is $15,000. Im so confused
That's the interest rate. Whatever the current interest rate is, use that...3%, 4%, he used 5%. Make sense?
How you get the formula😬
Paying back is almost double over 30 years time.
Thank you. U cleared one of my biiiig doubt, when u also explained the second method
Why would you teach the not simpler first
We should not look any interest rate be it Home Loan or Car Loan from the nominal perspective. The basic TVM concept says that you are supposed to look at the figure from the same point in time.
Once you will use the present value of an annuity function, then you will get the exact picture how much extra you are paying it turns out to be around $38966.30 in today's dollar value considering the risk free rate of 4%.
Truth. But using big words will intimidate the uninitiated. It will scare them away thus never bothering to ATTEMPT to make the EFFORT to understand this themselves.
And yes, we’re not guiding people by the wrist but now that i am more rounded off, i feel like it’s one of my purposes to teach.
I want to ask you something.
Who are you and where did you learn these things?
Sir, can you tell me about semi Annual compound interest
So jessica got some loans now ehhh? Memers only know lol
thank you very much for this video it is so helpful
Zero downpayment?
What does the 1 represent in the formula?
great that you can plug in numbers to equations.
Good explanation & you have made mortgage calculation simple & your formula are more straightforward compare to many other tutorial that I saw in youtube. Just asking, do you have any easy method to calculate the result amount for 4.4677 which we get from (1+r)n?
🇵🇬🇵🇬🇵🇬🇵🇬🇵🇬
Excellent video.
this helped so much with my real estate exam practice
Can you program this in C++ language?
🤙🏼🤙🏼🤙🏼Great video! Thank you!