Arizona Mortgage Calculator

Arizona Mortgage Calculator with taxes and insurance, PMI, and extra payments to calculate your monthly mortgage payments with amortization schedule.

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Arizona Mortgage Calculator with Taxes and Insurance

The mortgage calculator AZ has many options such as PMI, property tax, home insurance, payment frequency (monthly and bi-weekly), monthly HOA fees, and extra payments. You will also get an amortization schedule with monthly payment details and a summary of the mortgage on the payoff. Best of all, the amortization schedule is printable and exportable as an Excel spreadsheet or as a pdf file.

How do mortgages work?

A mortgage is a loan that you apply to finance the purchase of your home. The lender gives the borrowers a lump sum to help them buy a house. In return, the borrower repays the loan with interest on a monthly basis for a predetermined number of years, usually 30 years. On a conventional mortgage, the buyer puts down a down payment and the rest is financed by a bank. A mortgage is a secured loan that uses the home as collateral which means the lender can put the house into foreclosure to recoup their loss if the buyer defaults or fails to make monthly payments.

How does mortgage interest work?

There are different types of mortgages such as fixed and variable interest rates. With a fixed-interest mortgage, the monthly payments are the same over the course of the loan. A mortgage with variable interest will have unpredictable monthly payments. Variable interest rate mortgages usually have lower monthly payments initially and higher monthly payments down the road. If the interest rate rises too fast in the future, the borrowers could be faced with pressure paying their mortgages.

Fixed-rate mortgage pros and cons

There are pros and cons of mortgages with fixed interest rates vs variable rates. Pros of fixed-rate mortgage

• Fixed month payment - the monthly payments are unchanged through the term no matter how high the interest rate rises in the future.
• Easy to understand - fixed-rate mortgages are easier to understand which is good for first-time buyers. It is also easier to make comparisons between lenders and see which lender gives you the best option.
• Peace of mind - knowing that monthly payments would never rise gives peace of mind to borrowers.
• Inflation - if you are paying $1,000 in monthly payments today, you will be still paying the $1,000 twenty years later even though the same $1,000 twenty years from now is probably worth much less than today's money.
• Build equity faster - variable interest rates usually have lower monthly payments initially, but that means the homeowners are building equity slower. With a fixed interest rate mortgage, borrowers can build equity much faster.

Cons of fixed-rate mortgage

• Falling interest rate - if the interest rate falls dramatically in the future, you won't be able to take advantage of it unless you refinance the mortgage which comes with closing costs and other fees.
• It could be costly - if the interest rate was high when you got your mortgage, you are locked into this high-interest rate for the rest of the term which could be costly.
• Higher monthly payments - fixed interest rates usually have higher monthly payments than ARM in the initial period. Borrowers who cannot afford the higher monthly payments may not be able to buy a home.

The best time to use a fixed interest rate is when the interest rate is low and it is expected that the interest rate would rise in the near future. Borrowers would want to lock into this low rate so that they won't have to refinance the loan at a later point. However, it is hard to predict when the interest rate will rise or fall. One thing borrowers can do is compare the current rate to the interest rate in recent years and watch the inflation data. Usually, when inflation is high, the Fed may hike interest rates to fight inflation, in that case, it would be a wise idea to use a fixed interest rate.

How do mortgage payments work?

The monthly mortgage payments are divided into two parts, the principal and interest payments. It is the principal part that allows the homeowner to reduce their debt and build equity in their house. The interest payment is recalculated each month based on how much money you owe to the bank. Therefore, at the beginning of the term when your balance is the largest, most of the monthly payments are for interest payments with little going toward the principal. It could be years before the balance between the principal and interest payments begin to shift with more money going toward the principal than interest.

What do mortgage lenders look for?

Before starting to apply for a mortgage, first learn how the mortgage process works and what mortgage lenders are looking for. There is only one thing that mortgage lenders want to learn about the borrowers, the ability and willingness to repay the mortgage and interest. There are other costs that are associated with owning a house, such as property tax and home insurance. If your down payment is less than 20% on a conventional mortgage, you will need to pay for private mortgage insurance which is an additional cost. Mortgage lenders want to know how much you make, and how much debt you have to decide whether you are able to repay the loan, tax, insurance, and all the other costs. They also look at your credit score to check if you pay your other debts on time. If you are, then you will most likely repay your mortgage payments on time. Although the bank can foreclose the house and recoup their loss in case the borrower stops making payments, they do not like to deal with foreclosures. It is in the best interest of banks to make money from interest payments than seeing their borrowers default.

How to get the best mortgage rate?

Borrowers that are financially strong with good credit scores will get the best interest rates from lenders. Lenders will either deny borrowers with bad credit scores or charge them with high-interest rates. Borrowers with bad credit scores are more likely to default on the mortgage, and therefore more riskier to the bank than borrowers with high credit standing. To offset this type of risk, the banks will charge them a higher interest rate. Many banks will deny applications from borrowers with a credit score lower than 620. A higher interest rate would cost borrowers thousands and thousands of dollars in interest payments over the course of the term. Therefore, it is important to maintain a good credit score if you ever plan to buy a house on a mortgage. Paying off existing debts will help improve your credit score because it lowers your overall debt and credit utilization which in turn will raise your credit score. Lowing your debt will also lower your LTV which is a factor that lenders use to judge whether or not you will get the loan. The lower your LTV, the better. In addition to improving your credit score, you should shop around and compare the interest rates of different lenders. There are also other charges such as closing costs and fees that you should take into account when doing comparisons from lenders. After some research, borrowers should be able to find a lender that offers them the best mortgage rate and the least fees and closing costs on the mortgage.

How to apply for a mortgage?

Once you select a lender, you will need to prepare lots of documents to show the bank that you have the ability to repay the loan and that you are responsible for your loans. Following are some common documents that you need.

Documents needed for mortgage application

• W2 or 1099 - if you work for a company, you will need the W2 for the last 2 years. If you are self-employed, you will need 1099 from the last 2 years.
• Bank statements - show bank statements and investment accounts for the last 2 months as proof that you have the money for the down payment and closing costs.
• Recent Pay Stub - show recent pay stubs to prove that you are currently an employee and getting paid.
• Tax documents - you will need the personal tax documents from the last 2 years. If you own a business, you will need to provide the business tax documents as well.
• Signed contract - you will need a signed contract and sales agreement between the seller and you.

Your bank may ask for other documents, it is recommended that you submit the documents and statement promptly to avoid any delays in closing the deal. For those who are self-employed, the banks may need additional documents. Communicate with your mortgage loan originator to learn where you stand. Mortgage loan originators usually deal with dozens of mortgage applications, sometimes they may forget to inform you that you need additional documents. Therefore, it is wise to follow up with them from time to time if you have not heard from them.

How to use the Arizona mortgage calculator?

This house payment calculator Arizona with PMI has advanced options for a home mortgage. If you are looking for a simple mortgage calculator for other types of loans such as auto loans, you may want to use the simple mortgage calculator. If you would like to include taxes and insurance, you can simply enter the yearly property tax and yearly home insurance amount into the mortgage calculator with PMI Arizona. These amounts will be included in the AZ Mortgage Calculator, you can also enter a 0 for the property tax or home insurance if you do not want to include these amounts in your mortgage calculator and the mortgage amortization Arizona. This Arizona Mortgage Calculator with Extra Payment has everything you need to calculate your mortgage in Arizona such as PMI, extra payment, taxes and insurance. In addition, the mortgage calculator Arizona gives you biweekly and monthly payment options so you can view your mortgage amortization schedule by monthly or biweekly. The amortization schedule is both printable and downloadable so you can save it on your computer or have a physical copy.

For commercial loans in Arizona, please use the Arizona commercial mortgage calculator.