Hey all,
Can someone please explain to me how mortgage payments are calculated? I've tried online calculators, and I don't understand at all how the monthly mortgages can be so high. For example, entering a $750,000 home with a DP of $175,000 shows a monthly payment of over $4,300. While the taxes, insurance, etc. make perfect sense, the principal and interest is showing over $3,100 a month with a 5% mortgage.
Can someone please tell me, in laymen's terms, how this is calculated? It seems to me I would be paying back over a million bucks on a $575,000 mortgage.
I can understand that interest is clearly not calculated as %5 over the 30 years, because the above scenario more like 50%, but I don't exactly get how.
EDIT: Thank you to all the straight forward examples. My question has been answered to death! :)
I'm going to leave this post up, just in case someone else is puzzled by this ridiculousness.
Submitted November 09, 2018 at 11:02AM by raviyoli https://ift.tt/2OzxTVu
