Loan Details
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Taxes & Fees
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Please check your inputs.
Your Estimated Monthly Payment
$0.00
| Principal & Interest | $0.00 |
| Property Tax | $0.00 |
| Homeowner's Insurance | $0.00 |
| HOA Fees | $0.00 |
Loan Summary
| Loan Amount | $0.00 |
| Total Interest Paid | $0.00 |
| Total Cost of Loan | $0.00 |
| Payoff Date | – |
Understanding Your Mortgage Payment
Calculating your monthly mortgage payment is the first step in determining your home buying budget. This Mortgage Payment Calculator breaks down the costs associated with owning a home, helping you see exactly where your money goes every month. Unlike simple calculators, this tool factors in property taxes, homeowner's insurance, and HOA fees for a realistic estimate.
Components of a Mortgage Payment (PITI)
Most lenders refer to your monthly payment as PITI, which stands for:
- Principal: The portion of your payment that pays down the loan balance.
- Interest: The cost of borrowing money from your lender.
- Taxes: Property taxes assessed by your local government, usually collected in an escrow account.
- Insurance: Homeowner's insurance to protect the property against hazards.
How Interest Rate Affects Buying Power
Even a small change in interest rates can significantly impact your monthly payment and total loan cost. For example, on a $300,000 loan, a 1% increase in interest rate can increase your monthly payment by over $180 and cost you over $60,000 in additional interest over the life of a 30-year loan.
Principal vs. Interest Over Time
Mortgages use an amortization schedule. In the early years of your loan, the majority of your payment goes toward interest. As time passes, a larger portion is applied to the principal balance, accelerating your equity growth. Use the results section above to see the total interest paid over the life of the loan.
Frequently Asked Questions
What is an escrow account?
An escrow account is a holding account managed by your lender. You pay one-twelfth of your estimated annual taxes and insurance each month along with your mortgage. When the bills are due, the lender pays them on your behalf.
Should I put 20% down?
Putting 20% down usually avoids Private Mortgage Insurance (PMI), which is an extra cost not included in the basic PITI calculation unless specified. A larger down payment also reduces your monthly principal and interest payment.