how do i calculate a mortgage payment and a prepayment penalty. what are the equations for doing so?

Question

what is the equation for both?

Answer 1

There are differnt types of PPPs, but most operate on the same formula. It is 80% of 6 months interest. This is not 6 months worth of payments.
To figure this you multiply the balance by your current interest rate. You then divide that by two and finally multiply by .8.
Example 100k at 6% interest.
100000x.06= 6000
6000/2=3000
3000x.8=2400

Answer 2

a mortgage payment equation can vary depending on the type of the mortgage. If you are in an interest only mortgage, you should not use an amortization calculator. A regular principal and interest amortized loan is for those calculators. While the equation is decently straightforward, it's much easier to google a calculator.

As far a pre payment penalty, all you really need to do is multiply your monthly mortgage payment by 6. This is representing 6 months worth of interest. Most states have this limit as the prepay time period. Some states such as Michigan and Oregon only allow for 2 months (so you would multiply by 2 instead of 6) and others like MN I believe use 1 month.

Answer 3

A prepayment penalty can be up to 6 months principal/interest, or almost 6 months of mortgage payments. As far as the equation for calculating actual mortgage payment I can offer the following advice.

To see what the interest only payment will be you take the loan amount you're borrowing & multiply that by the loan percentage....Then divide that by 12 for the amount of months in a year.

For example: $200,000 at a 6% rate is (200000 x .06 / 12 = $1,000 per month). But then when you have to add principal, taxes and insurance, it can be +- 40% more. Loan officers can break this down for you even further.

Answer 4

Here's a mortgage calculator for you, simply plug in the mortgage info:

http://www.internetmortgagepro.com/MortgageCalculator.html

and for the prepayment penalty, simply find out what percentage the penalty is for (normally 1-4% of the loan amount)

and this is added on to your mortgage payoff if you refinance or sell the home before the pre-payment term is done.

Answer 5

the short answer is that you need to read the contract, which likely is available free or cheap from the land records office (or county recorder, etc. depending on the jurisidction).

Prepayment penalties are not standard.

As for the amount of the monthly mortgage payment, it is best to ask the servicing company. While the amounts of interest and principle can be directly calculated given the terms of the contract, the current status of the escrow account can not and therefore the amounts owing for real estate taxes and insurance need to be requested from the servicing company.

does this help?