1. What is a Mortgage Calculator?

Definition: This calculator estimates the monthly payment for a fixed-rate mortgage based on the loan amount, interest rate, and loan term.

Purpose: It helps homebuyers and refinancers in Baton Rouge understand their potential mortgage payments before applying for a loan.

2. How Does the Calculator Work?

The calculator uses the standard mortgage formula:

Where:

• \( M \) — Monthly mortgage payment (USD)
• \( P \) — Loan principal amount (USD)
• \( r \) — Monthly interest rate (annual rate ÷ 12, in decimal)
• \( n \) — Number of payments (loan term in years × 12)

Explanation: The formula calculates the fixed payment amount that will pay off the loan with interest over the specified term.

3. Importance of Mortgage Calculation

Details: Accurate payment estimation helps borrowers determine affordability, compare loan options, and budget effectively.

4. Using the Calculator

Tips: Enter the loan amount, annual interest rate (without % sign), and loan term in years. All values must be > 0.

5. Frequently Asked Questions (FAQ)

Q1: Does this include taxes and insurance?
A: No, this calculates only principal and interest. Baton Rouge homeowners should budget additional 1-2% of home value annually for taxes and insurance.

Q2: What's a typical interest rate in Baton Rouge?
A: Rates vary, but as of 2023, 30-year fixed rates typically range between 6-7%. Check with local lenders for current rates.

Q3: How does loan term affect payments?
A: Shorter terms (15 years) have higher monthly payments but lower total interest. Longer terms (30 years) have lower payments but higher total interest.

Q4: Are there special programs in Baton Rouge?
A: Yes, some local lenders offer special programs for first-time homebuyers or certain neighborhoods. Consult with a Baton Rouge mortgage professional.

Q5: How accurate is this calculator?
A: It provides estimates for fixed-rate mortgages. Actual payments may vary based on credit score, loan type, and lender fees.