How are monthly mortgage payments calculated?
There are many aspects that make up your monthly mortgage payments:
The total loan amount, the term of the loan (how long you take to pay the loan back), your interest rates, your monthly PMI (Private Mortgage Insurance) payments (if applicable), and your property tax and homeowners insurance payments (if these are being bundled into your mortgage).
Some homebuyers may choose a longer-term loan in the hopes of achieving a lower monthly mortgage payment, others may choose a shorter-term loan to reach their goal of paying off their mortgage sooner. (It’s important to note, if you get a great interest rate, you can still have inexpensive monthly payments even with a shorter-term loan.)
To get a better idea of your estimated monthly mortgage payments, check out our Mortgage Calculator here.