Estimated Mortgage Payment

There is a lot that you need to consider when looking for a mortgage. Not only do you need to accumulate a down payment, but you need to figure out how much your mortgage payments will cost per month and whether or not this is something you can afford. Considering that, continue reading to discover everything that you need to know about estimated mortgage payments.

Working out your estimated mortgage payments

There are a lot of different mortgage calculators available online today that can help you to work out your estimated mortgage payments. There are a number of key factors that are considered when it comes to working out how much your mortgage payments are likely to be per month. This includes the following:

The equation for estimating your mortgage payments

The typical equation for working out your typical mortgage payments is as follows:

M = P[r(1+r)^n/((1+r)^n)-1)]

Yes, it looks pretty complex, doesn’t it? However, if you input the figures in a calculator, we promise; it does work out. Plus, you do have those mortgage calculators that are already set up so you don’t need to worry about the equation yourself.

So, let’s take a look at what each letter represents so that you can do the equation yourself.

Estimated Mortgage Payment

Remember that a mortgage calculator will only provide an estimate

It is important to realize that a mortgage calculator is only ever going to provide you with an estimate. There are a number of different factors that can influence how much you pay. This includes insurance, property taxes, loan term, interest rate, down payment, and purchase price.

Most of the mortgage calculators will also assume a few things, for example, making assumptions about closing costs and that you are buying a property as your primary residence.

Mortgage payments per state

While some states have relatively lower property values, homes in states like New Jersey, Hawaii, and California generally will have much higher property expenses, which means people are going to need to pay more for their mortgage every month. Plus, mortgage interest rates differ by state.

An American Community Survey carried out in 2018 revealed that homeowners paid $1,556 per month on average. Not only did this incorporate their mortgage payment, but also HOA fees, utilities, property fees, and insurance costs where required.

Let’s take a look at some of the median monthly payments per state from the 2018 survey so that you can get a better understanding:

Final words on estimated mortgage payments

Hopefully, you now have a good start. You need to know about working out your estimated mortgage payments. We hope that the educational material and information we have provided above has helped you to get a better understanding of how much you are likely to pay per month for your mortgage. It is important that you have a thorough understanding of this so you can make sure you can afford your mortgage payments. Discuss further with MortgageQuote.com if you have any questions.

Sources

https://www.bankrate.com/calculators/mortgages/mortgage-calculator.aspx

https://www.bankofamerica.com/mortgage/mortgage-calculator/

https://www.usbank.com/home-loans/mortgage/mortgage-calculators.html

https://www.usbank.com/home-loans/mortgage/mortgage-calculators/mortgage-payment-calculator.html

https://www.businessinsider.com/personal-finance/average-mortgage-payment

https://smartasset.com/mortgage/mortgage-calculator