Introduction
Are you looking to calculate the Build Up Rate (BUR) for your financial or mortgage-related needs? This guide will walk you through the process of creating an HTML calculator that does just that. With the help of HTML forms and JavaScript, you can effortlessly determine the Build Up Rate for your investments. Let’s dive into the details.
How to Use
Using the Build Up Rate Calculator is straightforward, thanks to its user-friendly interface. Here are the steps to follow:
- Enter Mortgage Principal Paid for First Year: Begin by inputting the Mortgage Principal Paid for the first year in dollars ($).
- Enter Invested Cash in First Year: Next, provide the amount of Invested Cash in the first year, also in dollars ($).
- Calculate Build Up Rate: Once you’ve entered both values, click the “Calculate” button. The calculator will process the information and display the Build Up Rate in the designated area.
Now that you understand how to use the calculator let’s delve into the formula that powers it.
Formula
The Build Up Rate (BUR) is calculated using the following formula:
BUR = Mortgage Principal Paid for First Year (MPP) / Invested Cash in First Year (ICI)
This formula determines the rate at which your mortgage principal is being paid down relative to the cash invested in the first year. A higher Build Up Rate indicates efficient use of your funds.
Example
Let’s take an example to illustrate how the Build Up Rate is calculated:
- Mortgage Principal Paid for First Year (MPP) = $12,000
- Invested Cash in First Year (ICI) = $20,000
Using the formula:
BUR = $12,000 / $20,000 = 0.6
The Build Up Rate in this scenario is 0.6, indicating that for every dollar invested in the first year, 60 cents are applied to reducing the mortgage principal.
Frequently Asked Questions (FAQs)
Q1: What does a high Build Up Rate indicate?
A high Build Up Rate suggests that a significant portion of your invested cash in the first year is being used to pay down your mortgage principal, making it a financially efficient scenario.
Q2: Is the Build Up Rate a percentage?
No, the Build Up Rate is a ratio, not a percentage. It represents the portion of the invested cash being used to pay down the mortgage principal.
Q3: Can I use this calculator for commercial mortgages?
Yes, you can use the Build Up Rate Calculator for both residential and commercial mortgages.
Conclusion
The Build Up Rate Calculator is a valuable tool for anyone looking to assess the efficiency of their mortgage payments in the first year. By plugging in the Mortgage Principal Paid for the First Year and the Invested Cash in the First Year, you can quickly determine the Build Up Rate, helping you make informed financial decisions.