# Mortgage Calculator

## Let's calculate your monthly mortgage payment

The dollar amount you expect to pay for a home
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This is the initial payment you put toward the cost of your new home. How much do you plan to put down? You could put little-to-no money down depending on your loan type. However, when you enter a higher down payment into the mortgage calculator, it lowers your estimated monthly payment
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## Mortgage Calculator

Are you looking to buy a new home? Would you like to estimate your monthly mortgage payments beforehand? A home is a large purchase so it's important to find out on the front end the amount you could expect to pay on a monthly basis. You can use our mortgage payment calculator to easily estimate your monthly payment.

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## How Do I Use a Mortgage Payment Calculator?

Just enter the home price, your down payment amount, the interest rate, and the loan term, then press calculate and our mortgage calculator does the rest! It quickly takes the guesswork out of knowing how much home you can afford.

With our advanced mortgage calculator, you can:

• Change the down payment to see how it would impact your monthly payment.
• Compare monthly payments for different home prices. Change the home price in the mortgage calculator to see how it affects your monthly payment.
• See how shortening or lengthening the loan term affects your monthly payment.
• Mix and match different factors based on the loan options you are considering.
• Vary the interest rate to see how much you might save or pay based on rate changes.

## Mortgage Calculator: Using our Home Loan Calculator

Home Price

The dollar amount you expect to pay for a home.

Down Payment

This is the initial payment you put toward the cost of your new home. How much do you plan to put down? You could put little-to-no money down depending on your loan type. However, when you enter a higher down payment into the mortgage calculator, it lowers your estimated monthly payment.

Interest Rate

This is the cost of financing your home. You can adjust the interest rate on the mortgage calculator to see how it affects your monthly mortgage payment. Interest rates change daily based on market trends. Typically, your lender will determine your interest rate based on the perceived risk of lending you money to finance your home.

Here are some of the factors that influence their decision:

• Loan Type
• Credit History
• Loan Amount
• Down Payment Amount

Want to lock-in your mortgage interest rate? Read up on the benefits of a mortgage rate lock!

Loan Term

How long do you plan to finance your home? A shorter-term loan will generally have a lower interest rate than a longer-term loan. On the other hand, a longer-term loan will offer a lower monthly payment.

Here are some of the common loan terms entered into the calculator:

• 15-Year Fixed Rate Mortgage - A home loan paid over a term of 15 years. It will have a higher monthly payment but a lower interest rate than a 30-year mortgage.
• 30-Year Fixed Rate Mortgage - A home loan paid over a term of 30 years. It will have a lower monthly payment but a higher interest rate than a 15-year mortgage.
• I CAN Mortgage - A home loan that allows you to choose the term of your mortgage. You can finance your home for the number of years you want. You can enter 1, 5, or 10 years into the mortgage calculator to see how it would change your monthly mortgage payment.

Private Mortgage Insurance

If you enter a down payment of at least 20% of the home’s purchase price into the mortgage calculator, Private Mortgage Insurance (PMI) will not be added to your monthly payment. For example, a 20% down payment on a \$300,000 home is \$60,000.

PMI is required if you make a down payment of less than 20% or if you have less than 20% equity when you refinance; it may be canceled once you exceed 20% equity.

PMI guarantees that the lender gets paid if the borrower defaults on the loan. The PMI calculator defaults to .28 but PMI varies according to your credit score and the size of your down payment, it is usually an annual charge between 0.25% and 1.5% of the loan amount.

Want to stop paying mortgage insurance? We can show you how!

## Can a Mortgage Calculator Help Me Buy a Home?

Yes, a mortgage calculator can help you buy a home by letting you see what you can reasonably afford to spend. Here are a few ways you can use the mortgage calculator to plan for your future:

• Change the down payment amount and home price to see how it would impact your monthly payment.
• See the effects shortening or lengthening the loan terms would have on your monthly payment and total interest paid.
• Vary interest rates to see how your monthly and total payments change based on interest rate changes.
• Use the amortization schedule to see how much you will pay towards your principle balance and interest balance per month over the life of your loan.

## What Are the Most Common Types of Mortgages and Which Mortgage Should I Get?

The most common types of home mortgage loans include conventional loans, FHA loans, and VA loans. Here’s a simple breakdown of each:

• Conventional Loan: Not backed by the government, lenders may offer borrowers home mortgage loans with more flexible terms, features, and benefits.
• FHA Loan: Designed to make home ownership more affordable, these Federal Housing Administration insured mortgages allow buyers who are unable to qualify for a conventional loan to receive home financing.
• VA Loan: Guaranteed by the U.S. Department of Veteran Affairs, these loans help active duty military, veterans, and qualifying military spouses receive lower interest rates and better terms than available through a conventional mortgage loan.

Browse our mortgage loan options page for more information on these loans and more to explore your options.

## How Do I Lower My Monthly Mortgage Payment?

Our mortgage payment calculator can be the first step is understanding where you might be able to lower your costs each month.

There are a few proven ways of making sure you pay less every month:

• Don’t pay for PMI: a down payment of at least 20% will mean not having to pay for private mortgage insurance each month. This is especially important to consider if you are thinking about an FHA loan, where you could be paying mortgage insurance for the entire life of the loan regardless of how large your down payment is.
• Purchase less house: while it may seem obvious to many, a smaller home loan means a lower purchase price and smaller monthly mortgage payment.
• Take out a loan with a longer lifespan: with a longer loan term, your monthly payments will be lower; however, you’ll end up paying more in interest over the additional years.
• Find a lower interest rate: Not only can putting down more than 20% eliminate the need to pay mortgage insurance, but you’ll also end up with a lower interest rate as well.

## Can My Mortgage Payments Increase?

Yes, it is possible your monthly mortgage payment could go up in certain circumstances, including:

• If yours is an adjustable-rate mortgage.
• If your property taxes or homeowner insurance payments increase.

## How Much Home Can I Afford?

To determine how much house you can afford and if you qualify for a loan, lenders look at the following factors:

• Debt-to-income Ratio: Try to keep your debt-to-income ratio below 28%.
• Steady Income: You can prove your income in a few ways, including through bank statements, pay stubs, or tax returns.
• Payment History: A history of paying your bills on time lets lenders know you are a reliable borrower.
• Down Payment Amount: The higher your down payment, the likelier you are to be approved for a mortgage. Putting more money down lets you borrow less money and get better mortgage terms, too.

## What Factors Influence My Mortgage Interest Rate?

Your lender will determine your interest rate based on the perceived risk of lending you money to finance your home. The factors that influence your mortgage interest rate will include:

• Loan Type: Your interest rate can be influenced by whether you have a conventional loan or a government-backed loan.
• Credit Scores: If you have a higher credit score, you will most likely receive a lower interest rate than someone with a lower credit score.
• Loan Amount: How much you need to borrow for your home will influence the interest rate you receive on your mortgage.
• Down Payment Amount: Putting down more money means a lower interest rate, as you will need to borrow less money for your home.
• Length of Loan: A shorter-term loan generally brings a lower interest rate than a longer-term loan, but also means higher monthly payments.

Additionally, borrowers can opt for a fixed interest rate or an adjustable interest rate. The former locks in your rate for the length of your loan, whereas the latter changes based on various factors.

## What Costs Are Included in a Mortgage Payment?

The typical costs included in a mortgage payment are principal, interest, taxes, and insurance.

• Principal: The amount you borrowed for your home and how much you have left to pay.
• Interest: The cost of financing your home.
• Taxes: Property taxes go towards funding local public services.
• Insurance: Homeowner’s insurance helps protect against significant costs in the event of a fire or other highly damaging events.

Some people also choose to finance their closing costs, rolling those payments into their home mortgage loan.

## Can I Make Additional Payments to My Mortgage?

Yes, you can make additional payments to your mortgage, allowing you to pay down your principal balance faster. This shortens the overall length of your mortgage, ensuring you pay less in interest and save more in the long term.

## Should I Choose a Short-term or Long-term Mortgage?

The loan term you choose will depend on your circumstances, with both short- and long-term loans offering many different benefits.

• Short-term Loan: They usually offer lower interest rates but require higher monthly payments.
• Long-term Loan: Come with lower monthly payments, but higher interest rates and greater total interest costs.

When deciding what loan terms are right for you, factor in both monthly payments and the total cost of your loan.

## Go Beyond Our Mortgage Calculator

Have questions about using the mortgage payment calculator? Wondering how much house you can afford? Whether you need help with real estate investing or loans for first time home buyers, we're here to help with your home financing needs.