In short, a mortgage payment calculator helps you determine an estimate of what your monthly payments may be so you can set a realistic homebuying budget before buying a home. We show you how much you can expect to pay along with a detailed breakdown of where your money is going each month. Since your home payment will likely be your largest recurring expense, it’s important to make sure you’ll be able to afford your new payment.
Our mortgage calculator can help you specifically determine:
The right home price. If your estimated monthly payment is higher than you can afford, it can help you determine if you need to adjust any estimates – the highest one being your target home price.
If your credit is too low. To qualify for a loan, we require a credit score of at least 620.
Which loan term is right for you. Our calculator accounts for fixed-rate mortgages — mortgages with rates that remain the same throughout the life of the loan. A 30-year fixed-rate mortgage means you’ll have a lower monthly payment, but you’ll pay more interest over the course of the loan. In comparison, a 20-year or a 15-year fixed-rate mortgage result in a higher monthly payment, but less interest you’ll pay during the course of the loan.
You may also want to consider an adjustable-rate mortgage (ARM) if you plan on moving or refinancing in 5, 7, or 10 years. View our ratesto compare current fixed-rate and adjustable-rate mortgage options.
How the additional monthly expenses affect your payment. On your own, you may not remember to factor in the extras like estimated property tax, homeowners insurance, and private mortgage insurance (PMI), but these certainly can add up. Seeing them itemized as part of your total payment can help you better understand all you’ll be responsible for paying each month.
First, we’ll ask for some information from you, such as your desired home price, credit score, and the property ZIP code of the area you’re home shopping. You can also enter an amount for your down payment, but we’ll automatically set this at the traditional standard down payment amount of 20%.
If you really want to get in the weeds, select Advanced Options and knock out that section as well. But no stress if you don’t want to - we’ve already filled it out with the most common responses.
Once you’ve completed the form, the back end will do its calculating magic (aka math) and we’ll take you to the results where you’ll see a detailed breakdown of your estimated monthly payment. If you want to run the calculator again, you’ll be able to recalculate. Otherwise, if you like what you see, you can Get Started on your pre-approval.
A monthly mortgage payment includes principal and interest. Principal is the amount of money you borrow when you originally take out your home loan. Interest is the extra amount charged by the lender in exchange for the loan.
Other costs you need to factor in each month toward your total monthly payment include:
Property taxes. This is an annual fee usually determined by your local government and often based on a percentage of the home's assessed value. They typically range from about $100 to $200 a month. If you have an escrow account, your mortgage servicer will use funds placed in escrow to make the property tax payments each month on your behalf.
Private mortgage Insurance (PMI). You may need to pay this if your down payment is less than 20% of your home’s purchase price. This protects the lender (us) if a borrower (you) defaults on a home loan. PMI usually increases the monthly payment amount until you’ve paid off the equivalent of the 20% down in principal.
Homeowners insurance. This is a form of property insurance that covers damages and losses to your home or the things in your home due to events like inclement weather, vandalism, or burglaries. The price can vary depending on several factors like your state, the insurance company you select, and the age and rebuild value of the home. It typically averages around $1,200 a year.
With us, in order to close, we’ll ask you to confirm you’ve paid the entire amount of your first year of homeowners insurance. After the first year, you may be able to pay this in monthly installments, either directly to the insurance company or through an escrow account managed by your mortgage servicer.
Homeowners association (HOA) dues. Though not all homes have HOA fees, when they do, they typically range from $100 to $700 a month. They typically cover things like home improvements and maintenance (for example, replacing your roof or weekly lawncare) and upkeep of any shared space, like a pool, gym, or community center.
Our affordability calculator is a good place to start. Here you can enter your household income and itemize your monthly debts in order to determine a suitable estimate for your home-buying budget.
Another good rule of thumb is to follow the 28/36 rule. This is used by lenders when determining who to extend credit to and helps calculate the amount of debt a household can safely take on. According to the rule, your household shouldn’t spend more than 28% of its gross monthly income on total housing costs and no more than 36% on total debts.
Total housing costs include things like your loan payment, home insurance, HOA fees, and property taxes. They don’t include utilities. Total debts include the same housing costs plus other monthly existing debts like car payments, student loans, and credit card payments. It’s important to get pre-approved as well so you know how much you can afford for your loan. Plus, you can use a pre-approval letter as leverage with sellers while house hunting. With us, pre-approval takes as little as 3 minutes. Get started
This amount depends on the type of loan you choose — but the higher the down payment, the less risky you seem to a lender. It's ideal to put down 20% of the home price, but it’s not required. To find out more, check out questions on sourcing a mortgage down payment or speak with one of our loan experts.
If your down payment is less than 20% of the home price, you may be required to pay private mortgage insurance (PMI).
You’ll typically pay 2 to 5% of the purchase price for closing costs. Keep in mind, earnest money (the amount you put down during an offer as a deposit toward your desired property) may count toward your payment. Also, paying points — getting a lower interest rate in exchange for paying more at closing — or receiving credits — getting a higher interest rate in exchange for money back at closing — also impacts your total closing cost amount.
Your rate is based on today's mortgage rates and current housing market. To get you a personalized, up-to-date rate, we also factor in your credit score, property location, property type, loan amount, loan type, term, and loan-to-value (LTV) ratio. The LTV ratio is the percentage of your current principal loan balance (based on your down payment, if purchasing) compared to your home’s original value.
An annual percentage rate (APR) is the measure of the cost to you for borrowing money each year, expressed as a percentage. It includes your interest rate, points, fees, and other charges associated with your loan. That’s why it may be higher than the interest rate.
The interest rate is the rate of interest charged on a home loan and can be fixed or variable, depending on which loan you choose.
The APR is a measure of the cost to you for borrowing money. The APR includes your interest rate, points, fees, and other charges associated with your loan – that's why it’s usually higher than your interest rate.