U.S. CitiesCity-Data Forum Index
Go Back   City-Data Forum > General Forums > Real Estate > Mortgages
 [Register]
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
View detailed profile (Advanced) or search
site with Google Custom Search

Search Forums  (Advanced)
Reply Start New Thread
 
Old 11-15-2008, 11:28 PM
 
Location: Denver
3,139 posts, read 6,903,098 times
Reputation: 2907

Advertisements

I thought the problem with APR is that there is no "standardized" way to calculate apr. As in what fees and such is rolled into the apr calculation. There for it was a poor way to judge the value of a mortgage.

The best way was to look at the actual rate and then look at the fees yourself.
Reply With Quote Quick reply to this message

 
Old 11-18-2008, 08:53 PM
 
55 posts, read 243,277 times
Reputation: 46
Hi Antonini,

That difference between your interest rate and APR seems really huge!

We closed last month on our home (30-yr fixed) with a rate of 5.25% and APR of 5.64%
Reply With Quote Quick reply to this message
 
Old 11-19-2008, 03:14 PM
 
Location: Laguna Niguel, CA
768 posts, read 3,958,169 times
Reputation: 456
PMI plays a factor in the APR, increases it by quite a bit. That is why FHA loans can have APR's ~1% higher than the actual note rate. There is the UFMIP + the monthly MI.
Reply With Quote Quick reply to this message
 
Old 11-21-2008, 07:38 PM
 
Location: Escondido, CA
1,504 posts, read 5,330,292 times
Reputation: 877
Interest rate: 5.875%
+ PMI: 1.09% ($151.01 * 12 / $166250)
+ 0.625 points: eff. 0.06%
+ $2755 closing costs: eff. 0.19%
---
APR 7.19%

So the bulk of your APR-interest gap comes from PMI, which seems to be too high. There's something else missing, because, to get from APR 7.19% to 7.38%, there must be around $3000 in other up-front fees hidden somewhere.
Reply With Quote Quick reply to this message
 
Old 02-08-2009, 03:17 PM
 
11 posts, read 13,393 times
Reputation: 11
Pretty solid explanation of APR and inside mortgage info

at Annual Percentage Rate (APR)

and an easy online APR calc - don't use ,'s you'll get an error http://banking.about.com/library/cal...lator_load.htm

hope this helps
Reply With Quote Quick reply to this message
 
Old 02-09-2009, 08:19 AM
 
4,542 posts, read 11,544,610 times
Reputation: 3063
Quote:
Originally Posted by f_m View Post
Here is Wells Fargo rates. The APR is only slightly higher than the interest rate. I would only expect it to be about 1/4% or so higher.

https://www.wellsfargo.com/mortgage/rates
What if you are paying PMI??
Reply With Quote Quick reply to this message
 
Old 05-13-2009, 05:15 PM
 
Location: Maryland
3 posts, read 19,560 times
Reputation: 22
Easy Way To Determine APR

There is a simple way to calculate the Annual Percentage Rate that I discovered when I first started out as a Loan Officer, because I did not have a software program to calculate it for me at the time- (I did not even have a computer or fax).

The annual percentage rate is not as complex as some think.

The purpose of APR is to bring clarity through disclosure, not confusion.
There is a way to figure out the problem of APR by using the Newton Raphson Method,
but there is a much easier way.

The APR is simply a vehicle through which the lender is required, by the federal
government, to translate costs associated with a given loan being considered..FOR EXAMPLE:

If the amount that you are borrowing is $100,000.00 @6.00% for 30 years, you will
have a payment of $599.55 P+I every month for 360 months.
If $3,000.00 within this loan amount is for the purpose of prepaid finance charges (fees) associated with origination, then your net loan amount is actually $97,000.00
At $97,000.00 loan amount (if you are using a rate of 6%), you would naturally calculate a lesser payment because of the reduced loan amount.

All you have to do to figure out the APR, is figure out what % rate you would need
to obtain that same payment of $599.55 at a loan amount of $97,000.00.

The rate you would need would be 6.2865% to produce this payment. (example).
This is your APR.

All it takes is a calculator and a little patience to narrow it down.
At this point, you are armed with the knowledge you need to determine the closing
costs on your mortgage quote accurately.


[RIGHT][/RIGHT]
Reply With Quote Quick reply to this message
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.

Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.


Reply
Please update this thread with any new information or opinions. This open thread is still read by thousands of people, so we encourage all additional points of view.

Quick Reply
Message:

Over $104,000 in prizes was already given out to active posters on our forum and additional giveaways are planned!

Go Back   City-Data Forum > General Forums > Real Estate > Mortgages
Similar Threads
Follow City-Data.com founder on our Forum or

All times are GMT -6.

2005-2018, Advameg, Inc.

City-Data.com - Archive 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35 - Top