How to Use The Repayment Calculator
You must have the following data:
The Math Behind it
For those who are curious about how our calculator works, we utilize the following formula to calculate mortgages:
- M = Monthly Mortgage Payment
- P = Principal / Initial Amount of Loan
- i = Interest Rate of the loan
- n = Number of months or terms for a 30-Year Mortgage (30 years * 12 months = 360, etc.)
Benefits of Using a Mortgage Calculator
Calculating your monthly repayments is a crucial step in determining how much house you can afford. This is likely to account for the majority of your living expenses.
When you purchase a property or refinance a home, you can use ROSHI’s mortgage calculator to estimate your monthly repayments. To run scenarios, alter the loan details in the calculator which can assist you in making the following decisions:
What Factors to Consider When Determining How Much You Can Borrow?
Lenders must evaluate your ability to repay the amount you wish to borrow. The debt-to-income ratio is one of many elements that go into that evaluation.
The percentage of pretax income that goes toward monthly debt obligations, such as the mortgage, auto payments, student loans, minimum credit card payments, and child support, is known as your debt-to-income ratio. Lenders prefer debt-to-income ratios of 36 percent or less — or a limit of $1,800 per month on a $5,000 monthly gross income before taxes.
Costs Which are Included in a Mortgage Repayment Plan
You might use ROSHI’s mortgage calculator if your mortgage payment only consisted of principle and interest. Most mortgage payments, however, have additional fees and charges. The following are the main elements of a monthly mortgage payment:
How to Lower Your Mortgage Payments?
You can use the mortgage calculator to run scenarios to see how you can lower your monthly payments:
It’s possible that your monthly payment will increase over time if:
- You have an adjustable-rate mortgage, and during the adjustment period, the rate climbs.
- Your home loan servicer charges you a late payment fee.
- The cost of property taxes or homeowner’s insurance increases. These costs are usually included in most mortgage payments.
What is a Home Mortgage’s Loan-to-Income Ratio?
The Total Debt Servicing Ratio (TDSR) framework regulates the loan-to-income ratio for a residential mortgage in Singapore. Your total debt obligations should not exceed 60% of your income. This covers mortgage loans, credit card debts, personal loans, and even unpaid appliance installments. Banks, on the other hand, may set higher limitations for refinancing. Every bank has different take up on this.
Is There a Cap on How Much Money I Can Borrow?
You can borrow up to 90% of the purchase price of your property with a HDB Concessionary Loan. The maximum loan amount for a bank loan is determined by the number of house loans you currently have. For the first housing loan, you can borrow up to 75 percent of the property purchase price, 45 percent for the second housing loan, and 35 percent for the third housing loan.
How to Figure Out How Much Your Mortgage Payment will be?
To find out how much you’ll be paying each month, enter the amount of your mortgage loan and the interest rate into the calculator above.
Is There a Maximum Loan Tenure?
For HDB flats, the maximum loan tenure is 30 years, and for private properties or Executive Condominiums, the maximum loan term is 35 years (EC). The percentage of your property’s price you can borrow depends on the length of your loan. To be eligible for the maximum loan, your loan term must be less than 30 years (for private residences and ECs) and more than 25 years (for commercial properties) (for HDB flats). At the end of the loan tenure, the borrower’s age cannot surpass 65. If you violate either of these conditions, your loan amount will be reduced by 20%
How Fixed Interest Rates Differs from Variable Interest Rates?
Over a set period of time, fixed rate packages maintain the same interest rate (typically 1 to 5 years depending on the package). This means that your loan package has a fixed rate that won’t fluctuate no matter what happens in the market. Fixed rate packages automatically switch to floating rates after the lock-in period expires.
Floating rate packages, on the other hand, feature interest rates that fluctuate daily based on the rise and fall of SIBOR and SOR rates. When opposed to fixed rate packages, these packages often feature lower interest rates at the onset, with SIBOR and SOR movements dictating how high or low the rate would be. Board rates and fixed deposit rates, not simply SIBOR/SOR, can be used to peg floating rates.
How Does Mortgage Insurance Work and What Does it Cover?
Mortgage insurance is a sort of insurance that covers your mortgage loan in the event of unforeseen circumstances. You will receive a lump sum payment that you or your family might utilize to pay down your mortgage. It’s sometimes referred to as mortgage term reduction insurance (MRTA). It is known as the Home Protection Scheme (HPS) for HDB and is required to be purchased if the property and loan are paid for using CPF. The MRTA is optional in the private property market.
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