How Much House Can You Afford?
Items That Can Make Up Your Monthly Mortgage Payment
1. Principle balance: this represents the money you originally borrowed and are paying back over the life of the loan.*
2. Interest on loan amount*
3. Real estate taxes: Normally, 1/12 of the most recent tax bill**
4. Insurance (Home Owners): Normally, 1/12 of the yearly policy amount**
5. Private Mortgage Insurance (PMI)***
6. Assessments (if any, condo, townhome, single family home)
* Almost every borrower’s payment will include both principle and interest.
** Most borrowers have payments that will include principle, interest, taxes and insurance (unless the lender doesn’t require escrows of real estate taxes and insurance).
*** Some borrowers who have less than 20% down are required to pay Private Mortgage Insurance (PMI). Depending on the type of dwelling you purchase you may or may not be required to pay assessments.
This mortgage calculator can be used to figure out monthly payments of a home mortgage loan, based on the home's sale price, the term of the loan desired, buyer's down payment percentage, and the loan's interest rate. This calculator factors in PMI (Private Mortgage Insurance) for loans where less than 20% is put as a down payment. Also taken into consideration are the town property taxes, and their effect on the total monthly mortgage payment.
Contact us for more information about financing your next real estate purchase.