AMORTIZE MORTGAGES
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How to Amortize Your Mortgage - PowerPoint PPT Presentation


This presentation from ForeclosureDataBank.com provides insights about amortizing mortgage. Learn about mortgage term, amortization schedule, pre-payments and extra payments etc.

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How to Amortize Your Mortgage

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AMORTIZE MORTGAGES

Amortizing mortgages, Calculating monthly payments

http://www.ForeclosureDataBank.com


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http://www.ForeclosureDataBank.com

HOW TO AMORTIZE YOUR MORTGAGE

Learn About

What is Amortizing?

Basic Concepts of Amortizing

Process of Amortizing your Mortgage


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WHAT IS AMORTIZATION

To amortize means to pay regular monthly payments to the lender against a fixed mortgage term.


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CONCEPTS OF AMORTIZATION

Monthly Payments/Mortgage Term

Monthly payments include principal amount and interest that is to be paid every month for fixed mortgage term.

Mortgage term means number of loan repayment years that starts from 5 years up to 30 years.


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CONCEPTS OF AMORTIZATION

Amortization Schedule

Amortization schedule depicts how each monthly installment is applied to balance of loan.

It shows how much more principal or less interest & visa versa is divided in each installment.


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CONCEPTS OF AMORTIZATION

Prepayments

Prepayments is a concept that allows the borrower to pay a few payments in advance. This provides certain amount of security in case borrower happens to miss any monthly installment.


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CONCEPTS OF AMORTIZATION

Extra Payments

Extra payments allow the borrower to pay extra money or surplus money in addition to current monthly installments as per borrowers convenience. This helps reduce the principal amount sooner.


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PROCESS OF AMORTIZING MORTGAGE

  • Analyze your financial statement

  • Understand basic amortization concepts

  • Generate hypothetical monthly payments & schedule using online tools

  • Analyze if the schedule fits your budget

  • Check what suits you best, higher or lower amortization

  • Speak & discuss with expert real estate agent before applying for mortgage


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SUMMARY

  • Amortization is a process of paying monthly installments for a fixed period of mortgage term.

  • Understand fundamental concepts like amortization schedule, prepayments, extra payments, mortgage term etc.

  • Research & prepare a hypothetical monthly payment & schedule chart as per budget for better understanding of financial obligations

  • Get advise from a professional real estate agent


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