Determining your mortgage loan principal (money you still owe to the bank for your house) can be very beneficial, particularly if you are looking to pay your mortgage off ahead of time. In order to figure out your remaining balance, you only need to know the loan amount, the interest rate on your loan, the length of your loan and how many months you have already paid. Together, all of these amounts will help you figure out the amount of principal you still owe.
As an example, pretend your total loan was for $250,000 with a five percent interest rate. The original loan was for 30-years, but you have already paid on the loan for 60 months. After paying on your loan for 60 months, you will have paid $59,457.88 in interest and only $20,595.73 toward the principal. If you subtract the $20,595.73 you have paid toward the principal from the original loan amount, this leaves you with $229,404.27 in principal left to be paid.
DISCLAIMER: There is NO WARRANTY, expressed or implied, for the accuracy of this information or it’s applicability to your financial situation. Please consult your own financial advisor.