Why You Should Use a Mortgage Calculator to Understand the Mortgage Amortization Process

Written by Michael Paetzold


Mortgage amortization is often a mystery torepparttar consumer. After all, they oftentimes watch as loan officers whip out their calculators and spill out complicated numbers in record time.

But most consumers, unless they work in an industry related torepparttar 141877 home buying and mortgage lending process, do not understand how loans are amortized. That’s okay—as a consumer it’s really not necessary for you to fully understandrepparttar 141878 amortization process and how your monthly mortgage payments are determined.

However, it is important, if you are seeking a home mortgage loan or if you already hold one, to have a general understanding of mortgage amortization and how to figure monthly payments.

In short, by having a general comprehension of mortgage amortization, you will be a more informed mortgage consumer.

What Does It Do?

When a mortgage loan is amortized,repparttar 141879 amortization schedule is what will calculaterepparttar 141880 amount of your monthly mortgage payment. A normal, or standard, mortgage amortization will allow forrepparttar 141881 monthly mortgage payment to cover all interest accrued onrepparttar 141882 loan inrepparttar 141883 last thirty days since your last payment as well as a portion to be applied torepparttar 141884 original principal balance ofrepparttar 141885 home mortgage loan.

By followingrepparttar 141886 mortgage amortization schedule,repparttar 141887 borrower is paying offrepparttar 141888 balance ofrepparttar 141889 mortgage loan principal, a little bit each month, and building equity into his home. It is not necessary forrepparttar 141890 mortgage consumer to knowrepparttar 141891 mathematical formulas that are used in mortgage amortization in order to be able to answer common mortgage questions.

What is important is that you have a general understanding of mortgage amortization; that you understandrepparttar 141892 ways that you can control or alter your mortgage amortization – allowing you to pay less for your home, and that you know what questions can be answered using a mortgage amortization schedule or a mortgage calculator.

Guru Focused: Robert Olstein’s Short Sells

Written by Dr. Charlie Tian


While it is rather rare that value gurus sell stocks short, Robert Olstein has been selling short in his Financial Alert Fund. The accountant-turned fund manager spots values by looking behindrepparttar numbers. Inrepparttar 141814 second quarter of 2004, Robert Olstein sold short American Italian Pasta Co. (PLB) at $31. After about 6 months he covered at $20, easily made more than $1 million for his fund. Currently he is shorting two stocks: Computer Sciences Corp (CSC) and Fleetwood Enterprises Inc (FLE), although things do not always go that smoothly.

Robert Olstein is certainly one ofrepparttar 141815 best money managers (that is why he is in GuruFocus’s Hall of Fame). The strategy of looking behindrepparttar 141816 numbers has brought his fund a 15.5% average annual return over 10 years after all fees. Its only down year was 2002, off 19%. In 2000,repparttar 141817 yearrepparttar 141818 tech bubble burst,repparttar 141819 fund was up 12%, and in 2001, up 17%.

Robert Olstein started shorting Computer Sciences Corp (CSC) inrepparttar 141820 first quarter of 2004 at an average price of $41. He said thatrepparttar 141821 accounting of CSC is not in accord with its economic reality, CSC is worth about $30. The price of CSC did not go down, however. He then shorted more shares. Butrepparttar 141822 price of CSC went up, byrepparttar 141823 fourth quarter of 2004,repparttar 141824 price of CSC was $56. It came down some inrepparttar 141825 first quarter of 2005, Robert Olstein was confident enough to short more shares again. As ofrepparttar 141826 end ofrepparttar 141827 first quarter, his shorting position in CSC totaled 504,500 shares with an average price of $42. As of this writing,repparttar 141828 price of CSC is $46.4.

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