Updated: Jul 1, 2023
The mortgage payment comparator serves as a vital tool for determining the impact of different payment amounts on the interest you will ultimately pay in the future. By simply entering various mortgage amounts, interest rates, and amortization periods, this tool provides a clear profile of the changes different payment methods can bring. The calculated mortgage payment represents the minimum amount the borrower must pay throughout the entire mortgage amortization period, making your commitment to these payments of utmost importance. The mortgage payment consists of two components: the principal and the interest portion. Initially, when you delve into the details, you'll realize that a significant portion of your mortgage payment goes towards paying off the interest. Understanding this fact is essential. It is worth noting that interest, known as "riba" in Islamic finance, holds significant implications in Islamic teachings regarding managing debt. Muslims have social and spiritual obligations when it comes to debts, and it is crucial for them to approach debt cautiously and following Islamic principles. In fact, in Islamic teachings, everything can be forgiven except for debt, emphasizing the importance of fulfilling financial obligations. Therefore, our mortgage payment comparator is designed to assist Muslims in making informed decisions about debts and mortgages. This tool allows Muslims to evaluate different scenarios and determine the most suitable payment options that align with their religious beliefs. This empowers individuals to navigate the world of finance while ensuring compliance with Islamic rulings. The mortgage payment comparator is an invaluable resource that allows users to assess the impact of varying payment amounts on their overall interest payments. This tool is especially significant for Muslims as it enables them to make informed decisions about debts and mortgages while adhering to Islamic principles. By utilizing this tool, individuals can approach financial commitments more confidently, ensuring they meet their obligations while staying true to their religious beliefs.
Enter different mortgage amounts, interest rates, or amortization periods and observe the change in the value of different payment methods. The mortgage payment calculated is the minimum payment to be made by the borrower until the end of the mortgage amortization years, so, your commitment matters. The mortgage payment includes the principal and interest portion. Initially, the major part of your mortgage payment goes to interest.
There are six options for mortgage payments: Monthly, Semi-Monthly, Weekly, Bi-Weekly, Accelerating Weekly, and Accelerating Bi-Weekly Payments. Out of six types, four are the non-Accelerating payments type: Monthly, Semi-Monthly, Weekly, and Bi-Weekly. The two payment methods are Accelerating Weekly and Accelerating Bi-Weekly payment methods. If you purchase a home for the first time, you should learn the differences between these payment methods. Your choice of each of the one gives a different outcome. In the begining, you can observe the different payment methods amount in the table below on the different interest rates.
The below tables give full insight into the mortgage interest savings for different payment methods. You will notice that the mortgage interest savings are similar for Monthly, Bi-Monthly, Weekly, or Bi-Weekly payment methods. For example, the Also, Accelerated Weekly and Accelerated Bi-Weekly payment methods have similar interest savings.
DISCLAIMER: We strive to offer users accurate information to the best of our knowledge. However, laws are subject to change; therefore, the user assumes full responsibility and should utilize the information on our website and this tool as a reference per our terms and conditions. If you believe any part of the calculation is incorrect or contains errors, we kindly request your feedback here.