In the process of developing Responsive Mortgage Calculator Pro, a significant hurdle has been defining a flexible system that allows for a variety of cost calculations beyond the basic mortgage or loan calculation. The system that I’ve decided on in the current iteration of RMC Pro is to provide a means to define additional cost calculations that can then be associated with a mortgage calculation. The specifics of that process are a matter of UX and may change once I’ve had a reasonable amount of feedback. The specifics of the actual cost calculations are more important.
Defining Cost Calculation Types
My intent is to create a single method for defining costs, and within that method to allow for enough flexibility to create the different cost types. My research has lead me to define four main methods by which costs are calculated.
- Flat Fees
- This includes things like lawyer’s fees and inspections.
- Fee Rates
- This is a fee that is a percentage of property value, like property tax, or loan amount, like an origination fee.
- Ranged Fees or Rates
- Some fees vary depending on the property value, mortgage amount, or loan to value (LTV). A simple version of mortgage insurance is an example of this, wherein the calculated fee is a percentage of mortgage amount and the percentage is determined by the LTV.
- Marginal Fees and Rates
- Like income tax, fees can be calculated at different rates for different portions of the loan amount or property value. Land Transfer Taxes are often like this, and might include flat fees for some ranges, percentage rates over other ranges, and are generally cumulative.
RMC Pro allows you to define as many of these costs as you want in whatever combination you need. Do you need something that isn’t defined here? Let me know and I’ll add it to the feature request list.