This calculation is based on two simple rules that lenders use to determine how much of a mortgage you can afford. The first rule is that your monthly housing costs should not exceed 32% of your gross monthly household income. Housing costs include monthly mortgage payments, taxes and heating expenses. If applicable, this sum should also include half of monthly condominium fees.
Secondly, your entire monthly debt load s hould not be any more than 40% of your gross monthly income. This includes housing costs, and other debts such as car payments, personal loans, and credit card payments.
Feel free to use the mortgage calculator on our website for a quick calculation. For a more in depth assessment CanEquity will display an entire payment schedule for the life of a mortgage along with a summary of payments, interest, and balances within the mortgage term.
The average price in the current St. John's Real Estate market for a single family home is about $150,000. Assuming a 5% ($7500) down payment. Interest rate of 5.79%
- The amount you will need to mortgage is $146,418.75. This is amount has CMHC insurance fees included. The calculation is as follows: Purchase Price ($150,000) subtract Down Payment ($7,500) equals $142,500. To this amount we add a 2.75% insurance premium based on your Loan to Value (LTV) ratio of 95%. Therefore, 2.75% of $142,500 is $3,918.75 (cost of your insurance), plus $142,500 equals $146,418.75.
- You will have 549 payments of $459.30 every 2 weeks for 21 years and 2 months, plus one final payment of $158.58 to payout a $146,418.75 loan with a rate of 5.79%.
- Choosing biweekly accelerated payments will pay off your mortgage 46 months sooner, with a total of $23,264.48 in interest savings.
- Mortgage balance remaining at end of term is $125,752.66.
- By increasing your Down Payment you could lower your LTV ratio, therefore lowering your CMHC insurance premium of 2.75%.
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