If you have a financial calculator, you can easily perform a number of transactions including your monthly payments on a mortgage. Once you have all of the terms and conditions of your loan, it's just a matter of finding the right keys on the calculator. You can take your payment and figure out how much in finance charges you will pay over the term of the loan.
Get all the terms and conditions of your mortgage loan. Take the example of a mortgage of $250,000 with an interest rate of 4 percent for a period of 10 years.
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Locate the keys on the financial calculator you will need. You can find a financial calculator on the website Dinky Town (see Resources). The (N) key represents the number of periods. If your loan is for 10 years, the number of periods will be 120 (10 x 12). The i% key represents the interest rate per period. The PV key represents the present value.
Enter $250,000 into the calculator and then hit the present value button, (PV). Now enter 4, (which is for the interest rate) and divide by 12 which equals 0.3333333. Press the i% button. Key into the calculator 10, (10 years) and multiply by 12. Your result will be 120. Then press the N button. To get your payment, press the "Compute" button and then the PMT button. Your monthly payment will be $2,531.12.
Check your answer by using a mortgage calculator, which is much simpler to use than a financial calculator. Enter the loan amount, interest rate and mortgage term and hit the "Calculate" button to get your payment. A mortgage calculator can be found on the website Bankrate.com (see Resources).
Payments computed on a financial calculator do not include taxes and insurance.
If you are not used to operating a financial calculator, it may take some time to get used to.