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I have talk about using Excel to calculate the

interest and principal payment of a SalliMae student loan and I thought I can do the same for a home mortgage. I think there should be a lot of people who don’t know how mortgage broker calculate their monthly payment and they may want to know how they can calculate the monthly mortgage payment themselves just to verify. In fact Microsoft Excel has all kinds of financial functions built into it and you can use them to do your own financial analysis. Excel is a very powerful tool.

In order to demonstrate how to using Excel as Mortgage Calculator I have prepared a sample Excel workbook for you to download. A screen shot of the workbook is as follow. . The calculator has several parameters you can set and these parameters are in blue. The parameters are the price of your home, the percentage you down pay, the interest rate of your loan, the term of your loan, your monthly HOA and your property tax rate. Once you set all these values the calculator will display a list of monthly payments over the term of your loan. It also breaks down the monthly payment into principal, interest, tax and HOA so that you will know how much of your monthly payment is tax deductible.

The calculator assumes you make your payment on the first day of the month. You may find small discrepancy between the number you calculate in Excel and the number you get from your mortgage broker. Most likely that is because of rounding.

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