Mortgage Calculator

Understanding Your Mortgage Payment

Your estimated monthly mortgage payment (often called PITI) includes:

• Principal & Interest (P&I): The core part of your payment that goes towards paying off the loan balance and the interest charged.
• Property Taxes: Taxes assessed by local government on your property's value. Lenders often collect this monthly via escrow and pay it annually on your behalf.
• Homeowners Insurance: Insurance protecting your home against damage (fire, weather, etc.). Also typically collected monthly via escrow.
• PMI (Private Mortgage Insurance): Usually required if your down payment is less than 20% of the home's value. It protects the lender if you default. This cost typically drops off once you reach 20% equity. Our calculator provides an estimate for the initial period.

Tips for Managing Mortgage Costs

• Increase Down Payment: A larger down payment reduces your loan amount, lowers monthly P&I, and can help you avoid PMI.
• Improve Credit Score: A higher credit score generally qualifies you for lower interest rates.
• Shop Around: Compare rates and fees from different lenders.
• Choose the Right Term: Shorter terms (like 15 years) mean higher monthly payments but significantly less total interest paid. Longer terms (like 30 years) have lower payments but cost more interest over time.
• Consider Bi-Weekly Payments: Making half-payments every two weeks results in one extra full payment per year, paying off your mortgage faster and saving interest (check with your lender if they offer this without fees).