Mortgage calculator

Real Estate Taxes or Property Taxes are taxes assessed on a home, and paid to your state, city, and/or local government(s). Property taxes can vary in cost from 1.5% to 2% of your home's value on an annual basis. Real Estate Taxes are typically billed twice annually. Property taxes can be paid in equal installments along with your monthly mortgage payment and homeowner's insurance. This arrangement is known as "escrowing" your taxes and insurance.

Homeowner's insurance is an insurance policy on your home which protects against minor, major, and catastrophic loss. Sometimes called "hazard insurance," all homeowners are required to carry such protection. Laws vary by state, but as a general rule, your homeowner's insurance policy must be in an amount that covers the cost to rebuild your home as-is. Homeowner's insurance costs vary by zip code and insurer.

Private Mortgage Insurance (PMI) or Mortgage Insurance, is a monthly payment by the homeowner for the benefit of the lender. With FHA loans and USDA loans, mortgage insurance is called Mortgage Insurance Premiums (MIP). Mortgage insurance can be paid upfront (UFMIP), as a single-premium, or sometimes as lender-paid (LPMI).

Closing costs are the expenses that buyers and sellers usually incur to complete a real estate transaction. Costs incurred may include loan origination fees, discount points, appraisal fees, title searches, title insurance, surveys, taxes, deed recording fees, and credit report charges.

Home value is the dollar amount for which the home can be purchased, or the current value if you are refinancing. This is not the same as "listing price," which is the price of a house when posted for sale. The home value does not include closing costs and loan fees. It's the contractually-agreed upon price for a home.

The loan term is the length of the loan, which is the number of years until the loan is paid-in-full. Most mortgages have a loan term of 30 years. Since 2010, the 20-year and 15-year fixed-rate mortgage have been increasingly common.

APR or Annual Percentage Rate refers to the annual rate of interest charged to borrowers and paid to investors. Every time an individual or entity borrows money in the form of a traditional loan to purchase a house, there is a cost for the privilege of borrowing money. This cost is known as interest. The annual percentage rate is the percentage of interest the borrower must pay on the loan, which ultimately adds up to the total cost of the loan shown in the Mortgage Calculator Results.

Consider this example: $1,000 is borrowed on a credit card. If the credit card has an APR of 11 percent, at the end of one year $110 will have been accumulated, raising the total cost of the loan to $1,110.

APR works by having lenders assess how risky it is to loan you money. A person with good credit history and low debt utilization may be rewarded with a lower APR than someone with a poor credit history or significant debt.

In general, lenders determine your APR based on several factors, including:

- The type of loan you apply for
- Your current debt
- Your credit history and current score

A down payment is an initial up-front partial payment for the purchase of the house. The main purposes of a down payment are: to ensure that the lender has enough capital to create money for a loan; to demonstrate that the borrower can raise a certain amount of money for long-term investment; and, to recover some of the balance due on the loan if the borrower defaults.

If you are buying a home for $100,000 and you make a $5,000 down payment, you will have $5,000 equity (5%) in your new home.

Some mortgage programs, such as the FHA loan, require a 3.5% down payment. While others, including the VA loan and USDA loan, require no down payment. Your down payment may not be the only cash required at closing so be sure to budget for closing costs and other items.

Homeowners Association (HOA) dues are typically paid by condominium owners and homeowners in a planned urban development (PUD) or townhome. HOA dues are usually paid each month but can also be paid semi-annually or annually. It is given directly to a management company or governing body for the association. HOA dues usually cover common services for tenants and residents. These services may include landscaping, maintenance of any type, and legal costs. Homeowners association dues vary by building and neighborhood.