Mortgage Calculator
Estimate your monthly mortgage payment by adjusting loan amount, interest rate, and term.
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Understanding Your Mortgage Payment
Your payment combines principal and interest. Use this tool to compare rates and terms to fit your budget.
Complete Mortgage Guide
Mortgage Payment Components
Principal & Interest (P&I)
The core loan payment that goes toward your loan balance and interest charges. Early payments are mostly interest, later payments are mostly principal.
Property Taxes
Annual property taxes divided into monthly payments and held in escrow. Rates vary by location, typically 0.5% to 2% of home value.
Homeowners Insurance
Monthly insurance premium held in escrow. Protects against damage, theft, and liability. Costs vary by coverage and location.
Private Mortgage Insurance (PMI)
Required when down payment is less than 20%. Protects lender if you default. Can be removed once you reach 20% equity.
Mortgage Types Explained
Fixed-Rate Mortgages
Interest rate stays the same for the entire loan term. Predictable payments, but may have higher initial rates than adjustable-rate mortgages.
Adjustable-Rate Mortgages (ARMs)
Interest rate adjusts periodically based on market conditions. Lower initial rates but payments can increase over time.
FHA Loans
Government-backed loans with lower down payment requirements (3.5%) and more flexible credit requirements. Include mortgage insurance.
VA Loans
Veterans Affairs loans for eligible service members. Often require no down payment and have competitive rates.
Mortgage Affordability Guidelines
28% Rule (Front-End Ratio)
Your monthly mortgage payment should not exceed 28% of your gross monthly income. This includes principal, interest, taxes, and insurance.
36% Rule (Back-End Ratio)
Your total monthly debt payments (including mortgage) should not exceed 36% of your gross monthly income.
Down Payment Impact
Larger down payments reduce monthly payments, eliminate PMI, and often secure better interest rates. Aim for 20% when possible.
Credit Score Influence
Higher credit scores typically qualify for lower interest rates. A 100-point difference can save thousands over the loan term.
Mortgage Shopping Tips
- Compare Multiple Lenders: Get quotes from at least 3-4 lenders to find the best rates and terms
- Check Your Credit: Review your credit report and score before applying
- Get Pre-Approved: Pre-approval shows sellers you're serious and helps determine your budget
- Consider Closing Costs: Factor in 2-5% of the loan amount for closing costs
- Lock Your Rate: Consider rate locks if you expect rates to rise during your home search
- Read the Fine Print: Understand all fees, penalties, and terms before signing
15-Year vs 30-Year Mortgage Comparison
15-Year Mortgage
- ✓ Lower interest rates
- ✓ Less total interest paid
- ✓ Build equity faster
- ✗ Higher monthly payments
- ✗ Less cash flow flexibility
30-Year Mortgage
- ✓ Lower monthly payments
- ✓ More cash flow flexibility
- ✓ Easier to qualify for
- ✗ Higher total interest paid
- ✗ Slower equity building