Mortgage Calculator

Calculate monthly mortgage payments, total interest, and amortization schedule.

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Calculate

Home Price*

Down Payment*

20%

fields.interestRate*

Loan Term*

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Enter Details to Calculate

US Mortgage Market Statistics

$412K

Median Home Price

6.5%

Avg 30-Year Rate

$2,200

Avg Monthly Payment

20%

Ideal Down Payment

Smart Mortgage Tips

20% Down Payment

Avoid PMI insurance by putting 20% down. This can save you $100-300/month on a typical mortgage.

Shop Multiple Lenders

Get quotes from at least 3-5 lenders. Even a 0.25% rate difference can save thousands over the loan term.

Check Your Credit

A score of 740+ gets you the best rates. Fix errors and pay down debt before applying.

Consider 15-Year

15-year mortgages have lower rates and save significant interest, though payments are higher.

Extra Payments

One extra payment per year can shorten a 30-year mortgage by 4-5 years and save tens of thousands.

28/36 Rule

Keep housing costs under 28% of income and total debt under 36% for financial stability.

Understanding Mortgages

A mortgage is a loan used to purchase a home or other real estate. The property itself serves as collateral for the loan. Mortgages are typically repaid over long periods, such as 15 or 30 years, through monthly payments.

Key Components of a Mortgage Payment

💰 Principal

The amount you borrow to purchase the home. This is paid down over the life of the loan.

📈 Interest

The cost of borrowing money, expressed as a percentage of the loan amount.

🏛️ Property Taxes

Annual taxes levied by local government based on your property's assessed value.

🛡️ Homeowners Insurance

Required insurance to protect your home and belongings from damage or theft.

Types of Mortgages

Fixed-Rate Mortgage

Interest rate remains constant for the entire loan term, providing predictable monthly payments.

Adjustable-Rate Mortgage (ARM)

Interest rate can change periodically based on market conditions, affecting your monthly payment.

FHA Loan

Government-backed loan with lower down payment requirements (as low as 3.5%).

VA Loan

No down payment loan available to veterans and active military members.

The Mortgage Process

1. Get Pre-Approved

Lender reviews your finances and tells you how much you can borrow.

2. House Hunting

Search for homes within your pre-approved budget range.

3. Loan Application

Submit formal application with documentation of income, assets, and debts.

4. Underwriting & Closing

Lender verifies all information and you sign final paperwork to complete the purchase.

Frequently Asked Questions

How much house can I afford?

A common guideline is the 28/36 rule: your monthly housing costs should not exceed 28% of your gross monthly income, and your total debt payments should not exceed 36%. For a more accurate estimate, use our Home Affordability Calculator.

What is PMI and when is it required?

Private Mortgage Insurance (PMI) is required when your down payment is less than 20% of the home's value. PMI protects the lender if you default on the loan. It typically costs 0.5% to 1% of the loan amount annually.

Should I choose a 15-year or 30-year mortgage?

A 15-year mortgage has higher monthly payments but lower interest rates and much less total interest paid. A 30-year mortgage has lower monthly payments but you'll pay significantly more in interest over time. Choose based on your budget and financial goals.

How do extra payments affect my mortgage?

Making extra payments toward principal can significantly reduce the total interest paid and shorten your loan term. Even one extra payment per year can save tens of thousands of dollars over the life of a 30-year mortgage.

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