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Mortgage Calculator: PMI, Interest and Taxes


The Spire

Buying a home is one of the biggest investments you will make in your life. For most, it can be the place that they expect to live for the next 20-30 years. There are advantages and a disadvantage to buying a home. The disadvantage is that home prices are on the rise, but the advantage is that mortgage rates are reasonable right now. 

A mortgage calculator can help figure out how much you would pay on a specific mortgage. Of course, everybody’s situation is different but this mortgage calculator can account for multiple factors that might affect your situation. What are those factors? Here is what goes into a mortgage calculator. 

Home Value

Home value is the first factor in determining mortgage payments. Lenders need to know how much the home that you intend to buy is worth. A buyer can ask a lender to give them a certain amount of money towards the home. This would be the loan itself, and then the buyer would just make a down payment on the house with the rest of their savings. 

If this is not your first house, then the worth of your past home may come into play when determining a new mortgage. However, if you are a first-time home buyer, a big factor will be the amount that you can put down for your down payment. Your current household salary will also come into play. 

Lenders will need to know if you can afford to make these monthly payments to buy a home that has a certain worth before they give you the loan. Once the value of the home is determined and if the buyer can qualify for the loan after their down payment, then the mortgage loan will be given out. 


Interest Rate 

This is the next factor for how much you will have to pay for a mortgage. Rates are stable, which is part of the reason why a lot of people want to buy homes. Some factors that may determine your interest rate are the current market trend, your credit score, and how many years you plan to have the mortgage loan. 


Number of Years

The number of years you intend to have the loan factors into your monthly payments and your interest rate. You may have to pay more per month if you have a shorter loan but you are also very likely to pay less interest on your loan if you take a shorter number of years to pay it off. 


Property Taxes

Every state has a different percentage system in place, so this is going to depend on what state you reside in. It will also depend on what your home value is because property taxes are a certain percentage of your home worth on an annual basis. You would need to look up your state’s property tax rates, and then apply that to your home value. 


Homeowners Insurance

This is typically required when getting a mortgage loan, as the lender would want you to have it to protect the asset. Some factors account for how much you have to pay for this such as the value of your home, how much you are getting loaned for your home, the condition of the house, the location, possible natural disasters, and more. Once you pick your plan, you will need to account for how much money you pay into that insurance annually. Then, that amount will go into your mortgage calculator. 



This stands for private mortgage insurance, and it is another type of insurance that your lender may require you to pay depending on your circumstances. Typically, those circumstances are if you own less than 20% of your home because you will then be considered a more risky investment. This is where your down payment comes in because if you put enough down on your house, you will then very likely avoid paying into this altogether. 

If you do have to pay for PMI, it is a percentage of the total mortgage on an annual basis. This percentage is usually anywhere between .5% to 1% of the total mortgage loan worth. A big way to save on insurance and interest payments here is to make sure you have more than 20% of the home value in your savings and assets to use as a down payment, that way you do not have to add on another expense. 


Mortgage Calculator

Use a mortgage calculator to determine monthly mortgage payments. It will have everything above come into effect from home value to the total loan, interest rate, number of years, property taxes, homeowners insurance, and PMI. Then, you can add up every part of your payment, and the calculator will give you a total amount that you will be expected to pay every month for every aspect of your home. 


Know Your Mortgage Payments

With the mortgage calculator and the factors that go into your mortgage payment, you should have a much better idea of how much you are going to have to pay every month if you are thinking about buying a home. 

Are you ready to buy your home? Start the process of buying a home today! 

A Lending Hand for Financing Home Mortgages

Spire Financial (A Division of V.I.P. Mortgage, Inc.) brings lending expertise to you. All of our loan officers offer personalized communication for every client, guiding them through the process. We can show you ways to maximize your finances and unlock future opportunities. Spire Financial keeps you in control of refinancing, debt consolidation, and home equity. Together, we can achieve your financial goals.