PITI Mortgage Calculator

It’s important when using a mortgage calculator that you also account for Mortgage Insurance, Property Taxes, Homeowners Insurance, and HOA fees as these will affect your monthly payment significantly. This is also referred to as your PITI payment - Principle, Interest, Taxes, Insurance.

What is Private Mortgage Insurance (PMI)?
Private Mortgage Insurance (PMI) is a lender requirement for a conventional loan when the borrower’s down payment is less than 20% of the purchase price. PMI is insurance to protect the lender in the event the borrower defaults on their loan. PMI will automatically be removed when the loan balance is 78% of the original purchase price. Once the borrower has made enough payments to achieve 20% equity in the home, they can contact their lender to have PMI removed. If your home has appreciated in value and you believe you have gained enough equity to remove PMI, you can contact your lender to have your home appraised.

How Much is PMI?
Typically 0.5% - 1% of the entire loan amount calculated on an annual basis. For the calculator above you will multiply your mortgage insurance rate by the loan amount and insert that number. The calculator will divide by 12 to add it to your monthly payment. Check with your lender to determine what PMI rate to expect for the terms of the loan you qualify for.

Mortgage Insurance on Government Backed Loans (FHA, USDA, VA)
FHA loans require an Up-front Mortgage Insurance Premium (UFMIP) paid at closing. Current rates in 2019 are 1.75% of the loan amount. FHA also requires an Annual Mortgage Insurance Premium (MIP) calculated yearly and added to your monthly payment. The Annual MIP rate varies depending on your Loan to Value Ratio (LTV), in other words how much you finance in relation to the value of the home. Rates can range from 0.5% to 1.05% depending on the length of the loan and the loan to value ratio. The minimum down payment allowed for an FHA loan is 3.5%. Most borrowers with a 3.5% down payment buying a home equal to or less than $625,200 will pay an annual mortgage insurance premium of 0.85%. Often times the mortgage insurance can remain for the life of the loan. Contact your lender for more info on FHA loans and how your payments and closing costs are affected.

USDA loans require an Upfront Guarantee Fee of 1% of the purchase price added to your loan balance. Mortgage Insurance on USDA loans is 0.35% calculated annually and added to your monthly payment. USDA loans do not require a down payment and the mortgage insurance will remain for the life of the loan. Contact your lender to see if you qualify.

VA loans do not require mortgage insurance. VA loans do require a VA Funding Fee paid at closing. This fee can vary from 2.15% of the loan for 0% down to 1.25% of the loan for a down payment of 10% or more. Contact your lender for more details on closing costs for VA loans.

It is always a good idea to get in touch with a lender to determine what loan products you qualify for, how your monthly payments are affected, and to plan for closing costs.

Property Taxes
You can find the annual property taxes on the listing. Be sure to use the property taxes without exemptions. This may be listed as the estimated taxes, not the actual taxes. Actual taxes will include the current owner’s tax exemptions. You can also find this information on the county appraisal district website.

Tax rates can vary from neighborhood to neighborhood and can change over time.

Homeowners Insurance
Homeowners Insurance rates can vary greatly depending on the age and condition of the property, liability, deductible, etc. Definitely get multiple quotes on homeowners insurance and keep in mind many companies offer discounts for bundling car and auto insurance. This website is helpful to see and compare average costs of homeowners insurance by zip code: https://www.insurance.com/average-home-insurance-rates

Flood Insurance
Flood Insurance is not included in homeowners insurance. Central Texas is prone to flooding so determining if your property is in a food zone is a must. The cost of flood insurance depends on the level of risk your property has to flood.
For more information on flood insurance visit the National Flood Insurance Program website: https://www.floodsmart.gov/
You can also visit the FEMA website for flood zones:
https://msc.fema.gov/portal/home

As your agent I can provide you with the flood map on the MLS listing, but you can also order a comprehensive flood report that is certified and insured here: https://www.myfloodstatus.com/njpft/order
This can be especially helpful if part or all of the structures on your property are in a flood zone.

Monthly HOA Fees
This information can be found on the listing. Take note if the amount on the listing is stated as monthly, quarterly, or yearly. While this is an added cost, it is not wrapped into your mortgage payment. You will be responsible for paying the HOA directly.