Home Loan Calculator
Calculate your mortgage payments, total interest costs, and amortization schedule. This calculator helps you understand the true cost of homeownership and compare different loan terms.
Additional Costs (Optional)
Monthly Payment
Principal & Interest:
$0.00
Taxes & Insurance:
$0.00
PMI & HOA:
$0.00
Total Monthly Payment:
$0.00
Loan Summary
Loan Amount:
$0.00
Total Interest:
$0.00
Total Cost:
$0.00
Affordability Check
Front-End Ratio:
0.00%
Back-End Ratio:
0.00%
Affordability:
Unknown
Understanding Home Loans
A home loan, also known as a mortgage, is a loan secured by real property through the use of a mortgage note. The mortgage note is a legal document that pledges the property as security for the loan. Home loans are typically used to purchase residential property.
Types of Home Loans
Fixed-Rate Mortgage
- Interest rate stays the same
- Monthly payment predictable
- 15, 20, or 30-year terms
- Higher initial rates
Adjustable-Rate Mortgage
- Rate adjusts periodically
- Lower initial rates
- Risk of payment increases
- Rate caps provide protection
FHA Loans
- Government-backed
- Lower down payment
- More lenient credit requirements
- Mortgage insurance required
VA Loans
- For veterans and military
- No down payment required
- No mortgage insurance
- Funding fee applies
Mortgage Terms and Rates
| Loan Type | Current Rates | Loan Limits | Benefits |
|---|---|---|---|
| 30-Year Fixed | 6.5% - 7.5% | $766,550 (high-cost areas) | Predictable payments |
| 15-Year Fixed | 5.5% - 6.5% | $766,550 (high-cost areas) | Lower total interest |
| 5/1 ARM | 5.5% - 6.5% | $766,550 (high-cost areas) | Lower initial payments |
| FHA 30-Year | 6.0% - 7.0% | $498,257 (high-cost areas) | Low down payment |
Down Payment Requirements
Minimum Down Payment by Loan Type
Conventional Loans
- 3% down (FICO 620+)
- 10% down (avoid PMI)
- 20% down (best rates)
- 25% down (conventional max)
Government Loans
- FHA: 3.5% down
- VA: 0% down
- USDA: 0% down
- Down payment assistance available
PMI Requirements
- Required for <20% down
- 0.5-1.5% of loan amount
- Can be canceled at 78% LTV
- Added to monthly payment
Down Payment Sources
- Savings and checking
- Gift funds (with restrictions)
- 401(k) loans
- Seller concessions
Closing Costs
Lender Fees:
- Origination fee (0.5-1%)
- Appraisal fee ($300-600)
- Credit report fee ($30-50)
- Lender's title insurance
Third-Party Fees:
- Title search and insurance
- Survey fee ($200-500)
- Attorney/notary fees
- Recording fees
Mortgage Affordability
Front-End Ratio:
- Housing payment / Gross income
- Should be =28%
- Includes PITI
- Lenders use for qualification
Back-End Ratio:
- All debt payments / Gross income
- Should be =36%
- Includes all monthly debts
- More comprehensive measure
Mortgage Pre-Approval
Benefits:
- Shows serious intent to sellers
- Locks in interest rates
- Identifies potential issues
- Speeds up closing process
Process:
- Submit financial documents
- Credit and employment check
- Appraisal of collateral
- Receive pre-approval letter
Key Takeaways for Home Loans
- Your home payment includes principal, interest, taxes, insurance, and possibly PMI
- Higher down payments reduce monthly payments and eliminate PMI
- Shorter loan terms mean higher payments but less total interest
- Get pre-approved before house hunting to know your budget
- Compare rates from multiple lenders to find the best deal
- Consider all closing costs when calculating total homebuying expenses
- Work on improving your credit score before applying for a mortgage
- Understand the difference between fixed and adjustable rate mortgages