Understanding Financial Calculators

When it comes to calculation of loans and mortgages, there is a special calculator, known as the “Financial Calculator”. This is a simple device that is built purely for the calculation of financial matters, such as interest rate, loan rates, mortgage rates and so on. The calculator has built in formulas and thus makes it easy to calculate financial rates.

Apart from being a physical device, a financial calculator is also a small programmed tool, posted on financial websites, for people to calculate their rates instantly. A typical financial calculator could cost somewhere around $ 35, and if you happen to be in a finance industry, this is a much needed device.

Loan calculators, mortgage calculators and credit card calculators are the three major financial calculators. Let’s describe each one of them respectively.

Loan Calculators

A loan calculator enables users to understand the payable amount of a loan, along with the specified interest rate. Using the loan calculator, you will be able to understand what the payable amount would be, keeping in consideration the principal amount and the interest rate. The loan calculator deals with the following values:

(a) The current loan amount

(b)Time taken to repay loans

(c) Current interest rate on current loan amount.

You can always use an online calculator instead of a physical calculator.

Mortgage Calculator

A mortgage branches out to two major types; fixed rate and adjustable rate mortgages

Fixed rate mortgage calculator requires information about.

(a) The loan amount.

(b) Interest rate

(c) Loan term

Punch in the values for the above information and you will get all the required calculations. The adjustable rate mortgage calculator is complex. You will need the following information.

(a) Loan amount.

(b) Interest value on loan amount.

(c) The time period of the loan.

(d) The time before loan adjustment

(e) Interval value, after loan adjusts initially

(f) Estimated rate after each adjustment.

The fact remains that a mortgage calculator can just give you an estimate and not an exact figure, as mortgage rates, constantly varies. You have to be aware of the constantly changing interest rates, and should seek the help of financial experts, if you need an actual understanding of the mortgage payment amount.

Credit Calculator

Credit cards interest rates always fluctuate, and you need to be alert of it.Without a firsthand knowledge of where your credit is being spent, and what are the charges along with it, you would be caught in a whirl of debts. A credit calculator could be a vital tool in helping you attain this firsthand knowledge. This will help you to stay on guard and prevent any debt crisis. Information required for credit calculator is.

(a) Current balance

(b) Annual interest rate

If you want you can also use online credit calculators, that will give you fast and updated values.

Mere calculations done on normal calculators cannot give you a satisfying answer to your loan calculations. Therefore, if you want to understand where your debts are headed, how much money you have to pay/spend, then a financial calculator is the best guide.