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Mortgage Calculator
Know the whole payment — not just the loan
Here's the mistake I watch buyers make before they ever tour a house: they calculate the loan and think they've calculated the payment. The bank's principal-and-interest number is the beginning of the story, not the end of it. Your real monthly cost includes property taxes, homeowner's insurance, and — if you put down less than 20 percent — PMI riding along until you build the equity to shake it. This calculator gives you the whole number, because you can't shop honestly with half of one.
What the numbers mean
Principal and interest pays the loan itself. Taxes and insurance usually flow through your escrow account — collected a little each month with the payment. PMI — private mortgage insurance — shows up when your down payment is under 20 percent. It protects the lender, not you, and it typically runs about half a percent to one percent of the loan per year. The good news: it fades away once you reach 20 percent equity. Put 20 percent down and it never enters the picture at all.
Two habits from thirty-plus years of closings. First, get pre-approved before you tour anything — a pre-approval tells you your true budget and makes every offer you write credible. Second, search below your pre-approval, not at it. If you're approved for $400,000, live in the $350,000-to-$375,000 range. That leaves room to compete, room for closing costs — typically 2 to 5 percent of the loan on top of your down payment — and room to breathe when the furnace needs replacing in year two.