Using a Mortgage Calculator with Taxes

A typical mortgage calculator enables a prospective buyer of real estate to tabulate his or her expected monthly mortgage payments. The calculator is a viable tool because it enables a person to enter specific values associated with their property's value, the length of their loan, the specific price of the home in question, and the amount of the loan.

All of these variables obviously differentiate from property to property and form loan to loan. Therefore, each situation and property yields a specific monthly mortgage rate. As a result, the mortgage calculator is an effective tool to accurately price the true cost of homes in relation to a person's income and financial standing.

The main problem associated with a typical mortgage calculator is that the tool does not incorporate the property's true value. Various regions and areas of the country possess different property tax rates. When purchasing a house these tax rates can greatly alter an individual’s monthly payment.

The generic mortgage calculator does not take into account the area's tax rates, and thus only includes the property's purchase price and the specifics of the loan.

A mortgage calculator with taxes will offer an individual a more accurate representation of his or her monthly mortgage payments. In addition to the generic information associated with the property and the loan, a mortgage calculator with taxes will require the yearly property taxes of the area, the yearly total for homeowner's insurance paid on the property, and any private insurance associated with the mortgage.

When these fields are completed, the mortgage calculator with taxes will tabulate the prospective buyer's monthly mortgage payments as well as his or her principal and interest, and taxes and insurance owed. In total, this represents the true cost of owning the property in question, and not just the monthly mortgage payments.