Your estimated monthly house note will appear here.
Understanding Your Monthly House Note
The "monthly house note" is a comprehensive term often used to describe the total monthly cost of owning a home, encompassing not just the principal and interest payment but also other essential costs. Accurately calculating this figure is crucial for budgeting, financial planning, and understanding your true housing expense. This calculator helps you estimate that total monthly cost.
Components of Your Monthly House Note:
Principal and Interest (P&I): This is the core loan payment. It covers the repayment of the amount borrowed (principal) and the cost of borrowing (interest) over the life of the loan. The formula for this is derived from the standard loan amortization formula:
M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1]
Where:
M = Monthly Payment
P = Principal Loan Amount (House Purchase Price – Initial Deposit)
n = Total Number of Payments (Loan Term in Years * 12)
Property Taxes: These are taxes levied by local governments based on the assessed value of your property. We've included an annual estimate here, which will be divided by 12 for your monthly payment.
Homeowners Insurance: This is an annual premium paid to protect your home against damage, theft, and liability. This annual cost is also divided by 12 for the monthly estimate.
Private Mortgage Insurance (PMI): If your initial deposit is less than 20% of the home's purchase price, lenders typically require PMI to protect them against default. This is usually an annual premium paid monthly and is included if applicable.
How the Calculator Works:
Our calculator takes your inputs for the house purchase price, initial deposit, loan term, annual interest rate, annual property taxes, annual homeowners insurance, and annual PMI.
It first calculates the Principal Loan Amount by subtracting your Initial Deposit from the House Purchase Price.
Next, it determines the Monthly Interest Rate (i) and the Total Number of Payments (n).
Using these values, it computes the Monthly Principal and Interest (P&I) payment.
Then, it calculates the monthly portions of Property Taxes, Homeowners Insurance, and PMI by dividing their respective annual costs by 12.
Finally, it sums up the Monthly P&I, the monthly property taxes, monthly homeowners insurance, and monthly PMI to give you the estimated total Monthly House Note.
Use Cases:
This calculator is invaluable for:
Prospective Homebuyers: To realistically estimate monthly housing expenses before making an offer.
Budgeting: To ensure your overall budget can comfortably accommodate your housing costs.
Financial Planning: To assess affordability and plan for long-term homeownership expenses.
Comparing Loan Options: By inputting different interest rates or loan terms, you can see how they impact your total monthly payment.
Remember, this is an estimate. Actual costs may vary based on lender fees, specific insurance policies, and changes in property tax assessments.
function calculateMonthlyNote() {
var principalAmount = parseFloat(document.getElementById("principalAmount").value);
var downPayment = parseFloat(document.getElementById("downPayment").value);
var loanTermYears = parseInt(document.getElementById("loanTermYears").value);
var annualInterestRate = parseFloat(document.getElementById("annualInterestRate").value);
var propertyTaxAnnual = parseFloat(document.getElementById("propertyTaxAnnual").value);
var homeownersInsuranceAnnual = parseFloat(document.getElementById("homeownersInsuranceAnnual").value);
var pmiAnnual = parseFloat(document.getElementById("pmiAnnual").value);
var resultDiv = document.getElementById("result");
resultDiv.innerHTML = "Your estimated monthly house note will appear here."; // Reset previous result
// Input validation
if (isNaN(principalAmount) || principalAmount <= 0 ||
isNaN(downPayment) || downPayment < 0 ||
isNaN(loanTermYears) || loanTermYears <= 0 ||
isNaN(annualInterestRate) || annualInterestRate < 0 ||
isNaN(propertyTaxAnnual) || propertyTaxAnnual < 0 ||
isNaN(homeownersInsuranceAnnual) || homeownersInsuranceAnnual < 0 ||
isNaN(pmiAnnual) || pmiAnnual principalAmount) {
resultDiv.innerHTML = "Initial deposit cannot be greater than the purchase price.";
return;
}
var loanAmount = principalAmount – downPayment;
var monthlyInterestRate = (annualInterestRate / 100) / 12;
var numberOfPayments = loanTermYears * 12;
var monthlyPI = 0;
if (monthlyInterestRate > 0) {
monthlyPI = loanAmount * (monthlyInterestRate * Math.pow(1 + monthlyInterestRate, numberOfPayments)) / (Math.pow(1 + monthlyInterestRate, numberOfPayments) – 1);
} else {
// Handle case where interest rate is 0 (unlikely for mortgage, but for completeness)
monthlyPI = loanAmount / numberOfPayments;
}
var monthlyPropertyTax = propertyTaxAnnual / 12;
var monthlyHomeownersInsurance = homeownersInsuranceAnnual / 12;
var monthlyPMI = pmiAnnual / 12;
var totalMonthlyNote = monthlyPI + monthlyPropertyTax + monthlyHomeownersInsurance + monthlyPMI;
// Format the result for currency display
var formattedTotalMonthlyNote = totalMonthlyNote.toLocaleString(undefined, {
minimumFractionDigits: 2,
maximumFractionDigits: 2
});
var formattedMonthlyPI = monthlyPI.toLocaleString(undefined, {
minimumFractionDigits: 2,
maximumFractionDigits: 2
});
var formattedMonthlyTax = monthlyPropertyTax.toLocaleString(undefined, {
minimumFractionDigits: 2,
maximumFractionDigits: 2
});
var formattedMonthlyInsurance = monthlyHomeownersInsurance.toLocaleString(undefined, {
minimumFractionDigits: 2,
maximumFractionDigits: 2
});
var formattedMonthlyPMI = monthlyPMI.toLocaleString(undefined, {
minimumFractionDigits: 2,
maximumFractionDigits: 2
});
resultDiv.innerHTML = "Estimated Monthly House Note: $" + formattedTotalMonthlyNote + "" +
"(P&I: $" + formattedMonthlyPI + ", Taxes: $" + formattedMonthlyTax + ", Insurance: $" + formattedMonthlyInsurance + ", PMI: $" + formattedMonthlyPMI + ")";
}