Say i have a mortgage of 200,000. One bank offers 5.oo%. The other offers 5.23% How do i calculate the interest paid over say 5 yrs. thanks
You haven't given us enough information to calculate the interest.
You need to know how much you're paying each year on your mortgage. Your interest the second and succeeding years will vary depending upon how much of the principle you pay each year. If you've paid off $5,000 of the principle in the first year, your interest costs will be different than if you've paid off $10,000 the first year.
To calculate the interest paid over a 5-year period, you need to know the specific payment structure of your mortgage. This includes the interest rate, the term (length) of the mortgage, and the payment frequency (e.g., monthly, bi-weekly, etc.).
Assuming a fixed interest rate and monthly payments, you can use a loan amortization calculator to determine the interest paid over the 5-year period. This calculator will provide a breakdown of your monthly payment, showing how much goes towards interest and how much goes towards the principal.
Here's how you can use the calculator:
1. Access an online loan amortization calculator or use a spreadsheet program like Microsoft Excel.
2. Enter the principal amount of $200,000.
3. Enter the interest rate for each bank (5.00% and 5.23% respectively).
4. Choose a loan term of 5 years (60 months).
5. Select a monthly payment frequency.
6. Click calculate and view the results.
The calculator will provide you with a detailed amortization schedule, which shows your monthly payments, the amount paid towards principal and interest for each payment, and the remaining balance over time. By summing up the total interest paid over the 5-year period, you can compare the offers from both banks.