Mortgage Calculator
Calculate your monthly mortgage payment and see how much home you can afford
Understanding Your Mortgage Payment
Your monthly mortgage payment typically includes these components:
Principal & Interest
Principal is the amount you borrow to purchase your home. Interest is the cost of borrowing, calculated as a percentage of your loan amount. Together they form your base mortgage payment.
Property Taxes
Annual taxes on your property, typically paid monthly through your mortgage escrow account. Tax rates vary significantly by state and county.
Home Insurance
Homeowners insurance protects your property against damage and liability. Most lenders require it to protect their investment in your home.
PMI (Private Mortgage Insurance)
Required when your down payment is less than 20% of the home price. PMI protects the lender and typically costs 0.5-1% of the loan amount annually.
How to Use This Calculator
This mortgage calculator helps you estimate your monthly payment including all costs: principal, interest, taxes, insurance, and PMI (if applicable). Adjust the values to see how different scenarios affect your payment.
Tips for getting accurate results:
- Enter the total purchase price of the home
- A 20% down payment (or more) helps you avoid PMI costs
- Select your state to get accurate property tax estimates
- Current interest rates vary by credit score and market conditions
- PMI can be removed once you reach 20% equity in your home
Understanding Today's Mortgage Market
The mortgage market has cooled significantly since the 2021 boom. After peaking during the COVID-19 refinancing surge, loan volumes have dropped nearly 70%. Today's market is more stable but slower, with fewer people buying and refinancing compared to recent years. This means less competition for buyers and more opportunities to negotiate.
Yes! Several programs help buyers with limited savings. FHA loans require just 3.5% down and are easier to qualify for. If you're military or a veteran, VA loans require $0 down. Rural buyers can use USDA loans with no down payment. First-time buyers may qualify for programs requiring only 3% down, with some offering up to $2,500 in assistance for closing costs.
An assumable mortgage lets you take over the seller's existing loan instead of getting a new one. This is huge if they locked in a low rate in 2020-2021! About 1 in 4 mortgages are assumable, mostly FHA and VA loans. While the process takes longer (45-90 days), you could save thousands per year by keeping their lower interest rate instead of today's higher rates.
If you locked in a rate around 3% during COVID, don't refinance! You'd be trading your great rate for today's much higher rates. Instead, consider a Home Equity Line of Credit (HELOC) as a second mortgage. This lets you borrow against your equity while keeping your original low rate on the first mortgage. Only the new borrowed amount has the higher rate.
It's confusing, but mortgage rates don't directly follow the Federal Reserve's rate cuts. While the Fed lowered rates from 5.5% to 4.5% in late 2024, mortgage rates depend more on long-term bond markets. Persistent inflation concerns keep these bond yields elevated, which means mortgage rates stay higher even as the Fed cuts rates. Think of them as being on different tracks.
Both can work great! After stricter regulations in 2008, many traditional banks stepped back from mortgages. Non-bank mortgage companies (like Rocket Mortgage, Better.com, etc.) now handle most home loans. They're regulated and often offer competitive rates and faster processing. The key is shopping around - compare at least 3 lenders regardless of whether they're a bank or mortgage company.
Important Notice
This mortgage calculator is provided for informational and educational purposes only. The calculations are estimates based on the information you provide and may not reflect actual loan terms, costs, or payments. We do not guarantee the accuracy, completeness, or applicability of any calculations or information provided. This calculator should not be considered as financial, legal, or tax advice. For accurate mortgage quotes and personalized financial advice, please consult with qualified mortgage professionals and financial advisors.