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Originally posted by @Daniel Hargraves :

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*This link comes directly from our calculators, based on information input by the member who posted.

What's the question?

@Christopher Phillips

Sorry. I wrote it in the wrong place. And it’s not showing in the post. My question is, in the holding cost breakdown, does the loan payment need to include both the Principal and interest? Or just interest? My assumption is just interest. Since the principal goes towards paying off the mortgage. But I wanted to double check

Originally posted by @Daniel Hargraves :

@Christopher Phillips

Sorry. I wrote it in the wrong place. And it’s not showing in the post. My question is, in the holding cost breakdown, does the loan payment need to include both the Principal and interest? Or just interest? My assumption is just interest. Since the principal goes towards paying off the mortgage. But I wanted to double check

Holding costs are everything it cost you to hold the property until you sell it. Principle, Interest, Taxes, Insurance, Utilities, Security Services, potentially HOA fees.

Some people do interest only loans, so they wouldn't need to include principle.

@Christopher Phillips

Ok, but how is the payment made on the principal considered a cost? Would that not be going towards equity? Since when you sell you won’t be left owing as much to pay off the loan?

Originally posted by @Daniel Hargraves :

@Christopher Phillips

Ok, but how is the payment made on the principal considered a cost? Would that not be going towards equity? Since when you sell you won’t be left owing as much to pay off the loan?

Analysis is based on cashflows. Mortgage payments are cash payments going out. There is no assumption of equity until you sell.