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Calculate your monthly mortgage payment, total payment, and total interest.
Monthly Payment Formula:
M = P × [r(1+r)^n] / [(1+r)^n - 1]
Where: P = principal, r = monthly interest rate, n = number of payments
A mortgage is a loan used to purchase real estate, where the property itself serves as collateral. The borrower repays the loan over a set period with interest.
Mortgage rates vary by market conditions. As of recent years, rates between 5-7% are common for 30-year fixed mortgages in the US. Your credit score and down payment significantly affect your rate.
A 15-year mortgage has higher monthly payments but lower total interest. A 30-year mortgage has lower monthly payments but you pay more interest over time. Choose based on your monthly budget.
Private Mortgage Insurance (PMI) is required when your down payment is less than 20% of the home price. It protects the lender and typically costs 0.5-1.5% of the loan amount annually.
A higher credit score typically means a lower interest rate. Even a 0.5% difference in rate can save tens of thousands of dollars over the life of a 30-year mortgage.