Use the bond amortization calculator to determine affordability of loans or mortgages. By adjusting the interest rate, term or repayment amounts you will be shown an amortization graph, indicating the effects of over or underpayment of repayment amounts.
It is startling to see what the overall effect of a small over payment on your bond amount every month saves you. By way of example, a R500 000 bond over 20 years repaid at the correct amount every month results in total repayments totalling R1,158,025.97. If we increase the repayment from the actual repayment amount of R4,825.11 to R5373.02 or about 10%, the repayment period is reduced to 15 years and you would have saved over R200 000. (please note that as the interest rate fluctuates, so will these figures)
By making these calculation and planning for your future, small differences in the repayment amounts can make debt free home ownership a reality sooner than you can imagine. There are various tools we should use to ensure that we are amortizing our bonds as fast as poissible and reducing your home loan insurance cost is the first port of call. Not sure what the cost of the Home Insurance is, get a quick home insurance quote to compare with what you are paying.
Don’t worry that the currency symbol is $, this makes no difference to the outcome. Just be aware that there may be a small amount in fees, etc which have not been catered for.
Here is another calculator that will show you how much you will have paid every year and over the entire period of your bond. Change the number of years and see how easily you can save hundreds of thousands of rands simply by increasing your monthly payment amount on your bond. The numbers are quite staggering and don’t just guess the Insurance amount, get a free Home Insurance quote.