Affordability Calculator
Affordability Calculator
Estimated Home Price You Can Afford
What Makes up Your Monthly Mortgage?
Principle
The portion of your monthly mortgage payment that goes toward reducing the actual balance of your loan. Each payment gradually lowers the amount you owe, and over time, more of your payment is applied to principal as the loan matures.
Interest
The cost of borrowing money from the lender, calculated based on your outstanding loan balance and your interest rate. Importantly, your interest rate is largely determined by your credit score—borrowers with higher credit scores typically qualify for lower rates.
Taxes
Property taxes are levied by your local government based on the assessed value of your home. These funds are used to support public services like schools, infrastructure, and emergency services.
Insurance
Homeowners insurance provides financial protection against damage to your home or personal belongings caused by fire, theft, storms, and other hazards. Lenders usually collect insurance premiums along with your mortgage payment and hold them in escrow to ensure your policy remains active
Private Mortgage Insurance
(PMI) is required when your down payment is less than 20% of the home’s value. It protects the lender in case you default on the loan and is added to your monthly mortgage payment. PMI can often be removed once you reach at least 20% equity in your home.
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