Calculator
Any-Purpose Loan Calculator
Estimated monthly payment on a loan for any purpose, where the collateral is an existing property.
A loan secured against an existing property makes it possible to raise funds for any purpose - a renovation, a business, a family event - at a significantly lower interest rate than a regular personal loan, thanks to the collateral the property provides. The calculator shows an estimate of the monthly payment according to the amount, rate and term you choose.
Estimated monthly payment
₪2,295
Total payment
₪413,096
Total interest payable
₪113,096
Loan-to-value (LTV): 20.0% of the property value
This is a general estimate only and does not include lien and file-opening costs. The final rate and terms are set by the lender according to the review of the file and the actual LTV.
How the calculator works
You enter the requested loan amount, an estimated annual rate, the repayment term, and the value of the property to be pledged. The calculator computes the fixed monthly payment by the Spitzer formula, the total amount paid and the total interest, and the loan-to-value ratio (LTV) - the ratio between the loan and the property's value.
The formula behind the calculation
Monthly payment = loan amount × monthly rate × (1 + monthly rate)^number of months ÷ ((1 + monthly rate)^number of months - 1). LTV = (loan amount ÷ property value) × 100.
What the calculator does not include
It does not include property lien costs, attorney fees and file-opening fees
The actual rate depends on the LTV, the credit score and the lender chosen
It does not compare fixed-rate and variable-rate tracks
Why it matters
A loan against a property places a lien on it as collateral, so it is important to understand what that means, not only the convenient rate it makes possible. The possible loan size depends on the free value in the property - the difference between its value and the existing mortgage on it, if any.
Frequently asked questions
What is the difference between a loan against a property and a regular personal loan?
A loan against a property carries a significantly lower rate thanks to the collateral, but places a lien on the property. An unsecured personal loan carries a higher rate but no risk to the property.
How much can you get against a property?
It depends on the free value - the difference between the property's value and the existing mortgage on it, and on the lender's policy.
Can you take a loan against a property that already has a mortgage?
Yes, as long as there is free value in the property - that is, the property's value is higher than the balance of the existing mortgage. The new loan is registered as an additional lien, ranking below the first mortgage.
Is there a restriction on how the money from a loan against a property is used?
No, it is a loan "for any purpose" - there is no requirement to report how the money is used, unlike a mortgage for buying an apartment, which is intended for a specific transaction.
What is LTV and why does it affect the interest rate?
LTV (Loan to Value) is the ratio between the loan amount and the value of the pledged property. Lenders usually allow a lien of up to 50%-70% of the property's value - the lower the LTV (that is, the more free value there is relative to the loan), the better the terms offered usually are.
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