Selling Price Of $100,000; 20% Down Payment; 12% For 25 Years. Calculate The Amount Of Mortgage, The Monthly Payment, Interest Portion Of First Payment, And Principal Portion Of First Payment?

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When you choose a mortgage, you'll need to think about the repayment methods, interest rate deals and special features which many mortgages offer. The best one for you will depend on your personal circumstances - therefore it's important that you understand your options and shop around.

A number of online mortgage calculators are available to help you work out mortgage rates and monthly payments. These can be found via search engines such as Google.

Both www.mortgage-calc.com and the Money Advice service offer a comprehensive breakdown of your payments, as well as offering to compare and find the best rates for you. Alternatively, you can consult individual banks or use the services of a mortgage broker, which will search for the best deals.

Purchasing a property of $100,000 dollars with a 20% down payment would mean that the potential buyer would be required to take out a mortgage of $80,000, paying back around $800 a month.

There are two main ways you can pay off this mortgage - these are known as 'repayment' or 'interest only'.

  • Repayment mortgage
With a repayment mortgage you make monthly repayments for an agreed period, known as the term, until you've paid back the loan and the interest.

  • Interest only mortgage
With an interest only mortgage you make monthly repayments for an agreed period; however, what you pay only covers the interest on your mortgage. Normally you'll also have to pay into another savings or investment plan that will then hopefully pay off the loan at the end of the term.

As well as this you must decide which interest rate is most suitable for your personal needs; these can include.

  • A standard variable rate
  • Standard variable rate with cashback
  • Discounted rate
  • Tracker
  • Fixed rate

Suitability of different deals will always depend on your personal circumstances, including your credit history, and any tie-ins or penalties that may be attached.

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