# mortgage calculation for bank employees in Ethiopia

## Introduction

The maximum loan amount is determined by multiplying the property value with the appropriate LTV Ratios.The ratio is a function of the loan term and debt service coverage ratio (DSCR). The ratios are as follows; if debt Service Coverage Ratio 2.5 ,then LTV Ratio is 80%.The maximum required loan amount = Property value * LTV Ratio.# Mortgage Payment=

## Calculation Method:-

For example, if you want to buy a house for $200,000 and your monthly payment is $2,000, then the amount of money that you will pay back in five years is $100,000. To calculate this amount:

- Divide the total cost by 12 months or 24 months (whichever period works best for you). This will tell you how much money needs to be paid back per month or quarter.
- Now add all these numbers together and multiply it by 12 or 24 as mentioned above (depending on whether it’s monthly or quarterly payments). If we’re doing quarterly payments then just multiply them by 4 instead of 12/24 because they’ll be getting paid every four months so there won’t be any difference between adding them together first *and* multiplying them later – just make sure that both operations are done correctly before moving forward!

## Gross monthly income of the applicants –

The gross monthly income of the applicants is the sum of their salaries, overtime pay and other income. The net monthly income of the applicant is calculated as follows:

- Gross Income minus deductions for mortgage payments (if applicable).
- Mortgage Payment + Other Deductions = Net Monthly Income After Taxes & Deductions

## Gross monthly expense of the applicants –

The gross monthly expense of the applicants is calculated as follows:

- Mortgage payment
- Taxes (property tax and insurance)
- Insurance for mortgage loan, including fire and theft cover. For properties located in areas where there are no specific insurance policies, you should purchase liability insurance for yourself as well as your spouse or partner to protect against any accidental injuries you may cause to others during the course of your work. You can also consider adding an additional general liability policy that would cover any liability claims made by third parties resulting from your negligence or breach of duty under these circumstances. Additionally, if you have children who will be using this property regularly with their families, it might be worthwhile to make sure they have appropriate health care coverage while they live in the house too!

## Net available monthly amount for mortgage payment –

Net available monthly amount for mortgage payment is calculated by:

- Net income = Gross income – tax – loan payment – insurance – rent
- Monthly expense = Food, Clothing and Transportation (FC&T)
- Entertainment and Education (EE)

The following table shows a sample calculation of the net available monthly amount for mortgage payment:

## Bank annual interest rate for mortgage calculation =12%

The annual interest rate for mortgage calculation is 12%. This means that if you take out a mortgage from this bank, your monthly payments will be based on an average of 12% of the total amount borrowed.

## Amortization period = 10 years or can be varied depending on the agrement

The amortization is the number of years it takes to pay off a loan. While this may seem like a simple concept, there are many different factors that determine its length:

- Type of Loan: Interest rate and term (length) will affect how quickly you can pay off your mortgage. For example, if you have a 30-year fixed rate mortgage at 5% interest with payments of $600 per month and the balance due at closing was $300k, then your monthly payment would be $2,000 ($600 x 12). However, if this same loan were instead offered with an 8% interest rate over 20 years with payments ranging from $1k-$1m per month depending on how long they stayed in their new home (10-20yrs), then their monthly costs could range anywhere from only about $800-$1k depending upon whether they wanted to refinance after 10 or 20 years since most people don’t want to move every two decades!

## Mortgage payment = net available monthly amount for mortgage payment * (1-(1+i)^-n ) / i

The maximum loan amount is determined by multiplying the property value with the appropriate LTV Ratios.The ratio is a function of the loan term and debt service coverage ratio (DSCR). The ratio is a function of the loan term and debt service coverage ratio (DSCR).

The DSCR describes how much you can afford to pay each month in interest, principle, taxes and insurance premiums. This translates into an annual payment that you need to make on your home loan after adding up all these expenses together. If you want to know more about this topic read our blog post: What’s Your Debt Service Coverage Ratio?

## The maximum loan amount is determined by multiplying the property value with the appropriate LTV Ratios.The ratio is a function of the loan term and debt service coverage ratio (DSCR). The ratio is a function of the loan term and debt service coverage ratio (DSCR). The ratios are as follows; if debt Service Coverage Ratio <= 1.0 , then LTV Ratio is 50% ;if 0.9 < DSCR <= 1.5 ,then LTV Ratio is 60%;if 1.5 < DSCR <= 2.5 ,then LTV Ratio is 70%;if DSCR > 2.5 ,then LTV Ratio is 80%.The maximum required loan amount = Property value * LTV Ratio.# Mortgage Payment=

The maximum loan amount is determined by multiplying the property value with the appropriate LTV Ratios.

The ratio is a function of the loan term and debt service coverage ratio (DSCR). The ratios are as follows; if debt Service Coverage Ratio 2.5 ,then LTV Ratio is 80%.

## Conclusion

The maximum loan amount is determined by multiplying the property value with the appropriate LTV Ratios.The ratio is a function of the loan term and debt service coverage ratio (DSCR).