Monthly Mortgage Payment Amount Calculator
Use this free tool to figure your monthly payments for a given loan amount. As a basic calculator it quickly figures the principal & interest payments on a fixed-rate loan. If you would like to calculate all-in payments with other factors like PMI, homeowners insurance, property taxes, points & HOA fees please use our advanced calculator.
Want to check out the best rates currently available? Current Ashburn mortgage rates are displayed below.
Current Ashburn 30-Year Mortgage Rates on a $260,000 30-Year Home Loan
The following table highlights current Ashburn mortgage rates. By default 30-year purchase loans are displayed. Clicking on the refinance button switches loans to refinance. Other loan adjustment options including price, down payment, home location, credit score, term & ARM options are available for selection in the filters area at the top of the table. The "Product" selection menu lets you compare different loan terms like 15 or 30 year fixed rate options & other lending options like 3/1, 5/1 & 7/1 ARMs or even IO ARMs.
Amortization Schedule for a 4.20% APR 30-Year Fixed-rate Mortgage
Year | Month | Interest | Principal | Balance |
---|---|---|---|---|
1 | 1 | $910.00 | $361.44 | $259,638.56 |
1 | 2 | $908.73 | $362.71 | $259,275.85 |
1 | 3 | $907.47 | $363.98 | $258,911.87 |
1 | 4 | $906.19 | $365.25 | $258,546.61 |
1 | 5 | $904.91 | $366.53 | $258,180.08 |
1 | 6 | $903.63 | $367.81 | $257,812.27 |
1 | 7 | $902.34 | $369.10 | $257,443.17 |
1 | 8 | $901.05 | $370.39 | $257,072.77 |
1 | 9 | $899.75 | $371.69 | $256,701.08 |
1 | 10 | $898.45 | $372.99 | $256,328.09 |
1 | 11 | $897.15 | $374.30 | $255,953.80 |
1 | 12 | $895.84 | $375.61 | $255,578.19 |
Year 1 | $10,835.52 | $4,421.81 | $255,578.19 | |
2 | 1 | $894.52 | $376.92 | $255,201.27 |
2 | 2 | $893.20 | $378.24 | $254,823.03 |
2 | 3 | $891.88 | $379.56 | $254,443.46 |
2 | 4 | $890.55 | $380.89 | $254,062.57 |
2 | 5 | $889.22 | $382.23 | $253,680.35 |
2 | 6 | $887.88 | $383.56 | $253,296.78 |
2 | 7 | $886.54 | $384.91 | $252,911.88 |
2 | 8 | $885.19 | $386.25 | $252,525.62 |
2 | 9 | $883.84 | $387.60 | $252,138.02 |
2 | 10 | $882.48 | $388.96 | $251,749.06 |
2 | 11 | $881.12 | $390.32 | $251,358.73 |
2 | 12 | $879.76 | $391.69 | $250,967.04 |
Year 2 | $10,646.19 | $4,611.14 | $250,967.04 | |
3 | 1 | $878.38 | $393.06 | $250,573.98 |
3 | 2 | $877.01 | $394.44 | $250,179.55 |
3 | 3 | $875.63 | $395.82 | $249,783.73 |
3 | 4 | $874.24 | $397.20 | $249,386.53 |
3 | 5 | $872.85 | $398.59 | $248,987.94 |
3 | 6 | $871.46 | $399.99 | $248,587.95 |
3 | 7 | $870.06 | $401.39 | $248,186.57 |
3 | 8 | $868.65 | $402.79 | $247,783.77 |
3 | 9 | $867.24 | $404.20 | $247,379.57 |
3 | 10 | $865.83 | $405.62 | $246,973.96 |
3 | 11 | $864.41 | $407.04 | $246,566.92 |
3 | 12 | $862.98 | $408.46 | $246,158.46 |
Year 3 | $10,448.75 | $4,808.58 | $246,158.46 | |
4 | 1 | $861.55 | $409.89 | $245,748.57 |
4 | 2 | $860.12 | $411.32 | $245,337.24 |
4 | 3 | $858.68 | $412.76 | $244,924.48 |
4 | 4 | $857.24 | $414.21 | $244,510.27 |
4 | 5 | $855.79 | $415.66 | $244,094.61 |
4 | 6 | $854.33 | $417.11 | $243,677.50 |
4 | 7 | $852.87 | $418.57 | $243,258.93 |
4 | 8 | $851.41 | $420.04 | $242,838.89 |
4 | 9 | $849.94 | $421.51 | $242,417.38 |
4 | 10 | $848.46 | $422.98 | $241,994.40 |
4 | 11 | $846.98 | $424.46 | $241,569.93 |
4 | 12 | $845.49 | $425.95 | $241,143.98 |
Year 4 | $10,242.86 | $5,014.48 | $241,143.98 | |
5 | 1 | $844.00 | $427.44 | $240,716.54 |
5 | 2 | $842.51 | $428.94 | $240,287.60 |
5 | 3 | $841.01 | $430.44 | $239,857.17 |
5 | 4 | $839.50 | $431.94 | $239,425.22 |
5 | 5 | $837.99 | $433.46 | $238,991.76 |
5 | 6 | $836.47 | $434.97 | $238,556.79 |
5 | 7 | $834.95 | $436.50 | $238,120.30 |
5 | 8 | $833.42 | $438.02 | $237,682.27 |
5 | 9 | $831.89 | $439.56 | $237,242.71 |
5 | 10 | $830.35 | $441.10 | $236,801.62 |
5 | 11 | $828.81 | $442.64 | $236,358.98 |
5 | 12 | $827.26 | $444.19 | $235,914.79 |
Year 5 | $10,028.15 | $5,229.19 | $235,914.79 | |
6 | 1 | $825.70 | $445.74 | $235,469.05 |
6 | 2 | $824.14 | $447.30 | $235,021.75 |
6 | 3 | $822.58 | $448.87 | $234,572.88 |
6 | 4 | $821.01 | $450.44 | $234,122.44 |
6 | 5 | $819.43 | $452.02 | $233,670.42 |
6 | 6 | $817.85 | $453.60 | $233,216.82 |
6 | 7 | $816.26 | $455.19 | $232,761.64 |
6 | 8 | $814.67 | $456.78 | $232,304.86 |
6 | 9 | $813.07 | $458.38 | $231,846.48 |
6 | 10 | $811.46 | $459.98 | $231,386.50 |
6 | 11 | $809.85 | $461.59 | $230,924.91 |
6 | 12 | $808.24 | $463.21 | $230,461.70 |
Year 6 | $9,804.24 | $5,453.09 | $230,461.70 | |
7 | 1 | $806.62 | $464.83 | $229,996.87 |
7 | 2 | $804.99 | $466.46 | $229,530.42 |
7 | 3 | $803.36 | $468.09 | $229,062.33 |
7 | 4 | $801.72 | $469.73 | $228,592.60 |
7 | 5 | $800.07 | $471.37 | $228,121.23 |
7 | 6 | $798.42 | $473.02 | $227,648.21 |
7 | 7 | $796.77 | $474.68 | $227,173.53 |
7 | 8 | $795.11 | $476.34 | $226,697.20 |
7 | 9 | $793.44 | $478.00 | $226,219.19 |
7 | 10 | $791.77 | $479.68 | $225,739.52 |
7 | 11 | $790.09 | $481.36 | $225,258.16 |
7 | 12 | $788.40 | $483.04 | $224,775.12 |
Year 7 | $9,570.75 | $5,686.58 | $224,775.12 | |
8 | 1 | $786.71 | $484.73 | $224,290.39 |
8 | 2 | $785.02 | $486.43 | $223,803.96 |
8 | 3 | $783.31 | $488.13 | $223,315.83 |
8 | 4 | $781.61 | $489.84 | $222,825.99 |
8 | 5 | $779.89 | $491.55 | $222,334.43 |
8 | 6 | $778.17 | $493.27 | $221,841.16 |
8 | 7 | $776.44 | $495.00 | $221,346.16 |
8 | 8 | $774.71 | $496.73 | $220,849.43 |
8 | 9 | $772.97 | $498.47 | $220,350.96 |
8 | 10 | $771.23 | $500.22 | $219,850.74 |
8 | 11 | $769.48 | $501.97 | $219,348.77 |
8 | 12 | $767.72 | $503.72 | $218,845.05 |
Year 8 | $9,327.27 | $5,930.07 | $218,845.05 | |
9 | 1 | $765.96 | $505.49 | $218,339.56 |
9 | 2 | $764.19 | $507.26 | $217,832.30 |
9 | 3 | $762.41 | $509.03 | $217,323.27 |
9 | 4 | $760.63 | $510.81 | $216,812.46 |
9 | 5 | $758.84 | $512.60 | $216,299.86 |
9 | 6 | $757.05 | $514.40 | $215,785.46 |
9 | 7 | $755.25 | $516.20 | $215,269.27 |
9 | 8 | $753.44 | $518.00 | $214,751.27 |
9 | 9 | $751.63 | $519.82 | $214,231.45 |
9 | 10 | $749.81 | $521.63 | $213,709.82 |
9 | 11 | $747.98 | $523.46 | $213,186.36 |
9 | 12 | $746.15 | $525.29 | $212,661.06 |
Year 9 | $9,073.35 | $6,183.98 | $212,661.06 | |
10 | 1 | $744.31 | $527.13 | $212,133.93 |
10 | 2 | $742.47 | $528.98 | $211,604.96 |
10 | 3 | $740.62 | $530.83 | $211,074.13 |
10 | 4 | $738.76 | $532.69 | $210,541.44 |
10 | 5 | $736.90 | $534.55 | $210,006.89 |
10 | 6 | $735.02 | $536.42 | $209,470.47 |
10 | 7 | $733.15 | $538.30 | $208,932.18 |
10 | 8 | $731.26 | $540.18 | $208,391.99 |
10 | 9 | $729.37 | $542.07 | $207,849.92 |
10 | 10 | $727.47 | $543.97 | $207,305.95 |
10 | 11 | $725.57 | $545.87 | $206,760.08 |
10 | 12 | $723.66 | $547.78 | $206,212.29 |
Year 10 | $8,808.57 | $6,448.77 | $206,212.29 | |
11 | 1 | $721.74 | $549.70 | $205,662.59 |
11 | 2 | $719.82 | $551.63 | $205,110.97 |
11 | 3 | $717.89 | $553.56 | $204,557.41 |
11 | 4 | $715.95 | $555.49 | $204,001.92 |
11 | 5 | $714.01 | $557.44 | $203,444.48 |
11 | 6 | $712.06 | $559.39 | $202,885.09 |
11 | 7 | $710.10 | $561.35 | $202,323.74 |
11 | 8 | $708.13 | $563.31 | $201,760.43 |
11 | 9 | $706.16 | $565.28 | $201,195.15 |
11 | 10 | $704.18 | $567.26 | $200,627.89 |
11 | 11 | $702.20 | $569.25 | $200,058.64 |
11 | 12 | $700.21 | $571.24 | $199,487.40 |
Year 11 | $8,532.44 | $6,724.89 | $199,487.40 | |
12 | 1 | $698.21 | $573.24 | $198,914.16 |
12 | 2 | $696.20 | $575.25 | $198,338.92 |
12 | 3 | $694.19 | $577.26 | $197,761.66 |
12 | 4 | $692.17 | $579.28 | $197,182.38 |
12 | 5 | $690.14 | $581.31 | $196,601.07 |
12 | 6 | $688.10 | $583.34 | $196,017.73 |
12 | 7 | $686.06 | $585.38 | $195,432.35 |
12 | 8 | $684.01 | $587.43 | $194,844.92 |
12 | 9 | $681.96 | $589.49 | $194,255.43 |
12 | 10 | $679.89 | $591.55 | $193,663.88 |
12 | 11 | $677.82 | $593.62 | $193,070.26 |
12 | 12 | $675.75 | $595.70 | $192,474.56 |
Year 12 | $8,244.50 | $7,012.84 | $192,474.56 | |
13 | 1 | $673.66 | $597.78 | $191,876.78 |
13 | 2 | $671.57 | $599.88 | $191,276.90 |
13 | 3 | $669.47 | $601.98 | $190,674.92 |
13 | 4 | $667.36 | $604.08 | $190,070.84 |
13 | 5 | $665.25 | $606.20 | $189,464.64 |
13 | 6 | $663.13 | $608.32 | $188,856.33 |
13 | 7 | $661.00 | $610.45 | $188,245.88 |
13 | 8 | $658.86 | $612.58 | $187,633.29 |
13 | 9 | $656.72 | $614.73 | $187,018.57 |
13 | 10 | $654.56 | $616.88 | $186,401.69 |
13 | 11 | $652.41 | $619.04 | $185,782.65 |
13 | 12 | $650.24 | $621.21 | $185,161.44 |
Year 13 | $7,944.22 | $7,313.12 | $185,161.44 | |
14 | 1 | $648.07 | $623.38 | $184,538.06 |
14 | 2 | $645.88 | $625.56 | $183,912.50 |
14 | 3 | $643.69 | $627.75 | $183,284.75 |
14 | 4 | $641.50 | $629.95 | $182,654.80 |
14 | 5 | $639.29 | $632.15 | $182,022.65 |
14 | 6 | $637.08 | $634.37 | $181,388.28 |
14 | 7 | $634.86 | $636.59 | $180,751.70 |
14 | 8 | $632.63 | $638.81 | $180,112.89 |
14 | 9 | $630.40 | $641.05 | $179,471.84 |
14 | 10 | $628.15 | $643.29 | $178,828.54 |
14 | 11 | $625.90 | $645.54 | $178,183.00 |
14 | 12 | $623.64 | $647.80 | $177,535.19 |
Year 14 | $7,631.09 | $7,626.25 | $177,535.19 | |
15 | 1 | $621.37 | $650.07 | $176,885.12 |
15 | 2 | $619.10 | $652.35 | $176,232.78 |
15 | 3 | $616.81 | $654.63 | $175,578.15 |
15 | 4 | $614.52 | $656.92 | $174,921.22 |
15 | 5 | $612.22 | $659.22 | $174,262.00 |
15 | 6 | $609.92 | $661.53 | $173,600.48 |
15 | 7 | $607.60 | $663.84 | $172,936.63 |
15 | 8 | $605.28 | $666.17 | $172,270.47 |
15 | 9 | $602.95 | $668.50 | $171,601.97 |
15 | 10 | $600.61 | $670.84 | $170,931.13 |
15 | 11 | $598.26 | $673.19 | $170,257.95 |
15 | 12 | $595.90 | $675.54 | $169,582.40 |
Year 15 | $7,304.55 | $7,952.79 | $169,582.40 | |
16 | 1 | $593.54 | $677.91 | $168,904.50 |
16 | 2 | $591.17 | $680.28 | $168,224.22 |
16 | 3 | $588.78 | $682.66 | $167,541.56 |
16 | 4 | $586.40 | $685.05 | $166,856.51 |
16 | 5 | $584.00 | $687.45 | $166,169.06 |
16 | 6 | $581.59 | $689.85 | $165,479.21 |
16 | 7 | $579.18 | $692.27 | $164,786.94 |
16 | 8 | $576.75 | $694.69 | $164,092.25 |
16 | 9 | $574.32 | $697.12 | $163,395.13 |
16 | 10 | $571.88 | $699.56 | $162,695.57 |
16 | 11 | $569.43 | $702.01 | $161,993.56 |
16 | 12 | $566.98 | $704.47 | $161,289.09 |
Year 16 | $6,964.02 | $8,293.31 | $161,289.09 | |
17 | 1 | $564.51 | $706.93 | $160,582.16 |
17 | 2 | $562.04 | $709.41 | $159,872.75 |
17 | 3 | $559.55 | $711.89 | $159,160.86 |
17 | 4 | $557.06 | $714.38 | $158,446.48 |
17 | 5 | $554.56 | $716.88 | $157,729.60 |
17 | 6 | $552.05 | $719.39 | $157,010.21 |
17 | 7 | $549.54 | $721.91 | $156,288.30 |
17 | 8 | $547.01 | $724.44 | $155,563.86 |
17 | 9 | $544.47 | $726.97 | $154,836.89 |
17 | 10 | $541.93 | $729.52 | $154,107.38 |
17 | 11 | $539.38 | $732.07 | $153,375.31 |
17 | 12 | $536.81 | $734.63 | $152,640.68 |
Year 17 | $6,608.92 | $8,648.42 | $152,640.68 | |
18 | 1 | $534.24 | $737.20 | $151,903.47 |
18 | 2 | $531.66 | $739.78 | $151,163.69 |
18 | 3 | $529.07 | $742.37 | $150,421.32 |
18 | 4 | $526.47 | $744.97 | $149,676.35 |
18 | 5 | $523.87 | $747.58 | $148,928.77 |
18 | 6 | $521.25 | $750.19 | $148,178.58 |
18 | 7 | $518.63 | $752.82 | $147,425.76 |
18 | 8 | $515.99 | $755.45 | $146,670.30 |
18 | 9 | $513.35 | $758.10 | $145,912.20 |
18 | 10 | $510.69 | $760.75 | $145,151.45 |
18 | 11 | $508.03 | $763.41 | $144,388.04 |
18 | 12 | $505.36 | $766.09 | $143,621.95 |
Year 18 | $6,238.61 | $9,018.72 | $143,621.95 | |
19 | 1 | $502.68 | $768.77 | $142,853.18 |
19 | 2 | $499.99 | $771.46 | $142,081.73 |
19 | 3 | $497.29 | $774.16 | $141,307.57 |
19 | 4 | $494.58 | $776.87 | $140,530.70 |
19 | 5 | $491.86 | $779.59 | $139,751.11 |
19 | 6 | $489.13 | $782.32 | $138,968.80 |
19 | 7 | $486.39 | $785.05 | $138,183.74 |
19 | 8 | $483.64 | $787.80 | $137,395.94 |
19 | 9 | $480.89 | $790.56 | $136,605.38 |
19 | 10 | $478.12 | $793.33 | $135,812.06 |
19 | 11 | $475.34 | $796.10 | $135,015.95 |
19 | 12 | $472.56 | $798.89 | $134,217.06 |
Year 19 | $5,852.45 | $9,404.89 | $134,217.06 | |
20 | 1 | $469.76 | $801.68 | $133,415.38 |
20 | 2 | $466.95 | $804.49 | $132,610.89 |
20 | 3 | $464.14 | $807.31 | $131,803.58 |
20 | 4 | $461.31 | $810.13 | $130,993.45 |
20 | 5 | $458.48 | $812.97 | $130,180.48 |
20 | 6 | $455.63 | $815.81 | $129,364.67 |
20 | 7 | $452.78 | $818.67 | $128,546.00 |
20 | 8 | $449.91 | $821.53 | $127,724.47 |
20 | 9 | $447.04 | $824.41 | $126,900.06 |
20 | 10 | $444.15 | $827.29 | $126,072.76 |
20 | 11 | $441.25 | $830.19 | $125,242.57 |
20 | 12 | $438.35 | $833.10 | $124,409.48 |
Year 20 | $5,449.75 | $9,807.59 | $124,409.48 | |
21 | 1 | $435.43 | $836.01 | $123,573.47 |
21 | 2 | $432.51 | $838.94 | $122,734.53 |
21 | 3 | $429.57 | $841.87 | $121,892.66 |
21 | 4 | $426.62 | $844.82 | $121,047.83 |
21 | 5 | $423.67 | $847.78 | $120,200.06 |
21 | 6 | $420.70 | $850.74 | $119,349.31 |
21 | 7 | $417.72 | $853.72 | $118,495.59 |
21 | 8 | $414.73 | $856.71 | $117,638.88 |
21 | 9 | $411.74 | $859.71 | $116,779.17 |
21 | 10 | $408.73 | $862.72 | $115,916.45 |
21 | 11 | $405.71 | $865.74 | $115,050.72 |
21 | 12 | $402.68 | $868.77 | $114,181.95 |
Year 21 | $5,029.81 | $10,227.53 | $114,181.95 | |
22 | 1 | $399.64 | $871.81 | $113,310.14 |
22 | 2 | $396.59 | $874.86 | $112,435.28 |
22 | 3 | $393.52 | $877.92 | $111,557.36 |
22 | 4 | $390.45 | $880.99 | $110,676.37 |
22 | 5 | $387.37 | $884.08 | $109,792.29 |
22 | 6 | $384.27 | $887.17 | $108,905.12 |
22 | 7 | $381.17 | $890.28 | $108,014.84 |
22 | 8 | $378.05 | $893.39 | $107,121.45 |
22 | 9 | $374.93 | $896.52 | $106,224.93 |
22 | 10 | $371.79 | $899.66 | $105,325.27 |
22 | 11 | $368.64 | $902.81 | $104,422.47 |
22 | 12 | $365.48 | $905.97 | $103,516.50 |
Year 22 | $4,591.89 | $10,665.45 | $103,516.50 | |
23 | 1 | $362.31 | $909.14 | $102,607.36 |
23 | 2 | $359.13 | $912.32 | $101,695.05 |
23 | 3 | $355.93 | $915.51 | $100,779.53 |
23 | 4 | $352.73 | $918.72 | $99,860.82 |
23 | 5 | $349.51 | $921.93 | $98,938.89 |
23 | 6 | $346.29 | $925.16 | $98,013.73 |
23 | 7 | $343.05 | $928.40 | $97,085.33 |
23 | 8 | $339.80 | $931.65 | $96,153.68 |
23 | 9 | $336.54 | $934.91 | $95,218.78 |
23 | 10 | $333.27 | $938.18 | $94,280.60 |
23 | 11 | $329.98 | $941.46 | $93,339.14 |
23 | 12 | $326.69 | $944.76 | $92,394.38 |
Year 23 | $4,135.21 | $11,122.12 | $92,394.38 | |
24 | 1 | $323.38 | $948.06 | $91,446.31 |
24 | 2 | $320.06 | $951.38 | $90,494.93 |
24 | 3 | $316.73 | $954.71 | $89,540.22 |
24 | 4 | $313.39 | $958.05 | $88,582.17 |
24 | 5 | $310.04 | $961.41 | $87,620.76 |
24 | 6 | $306.67 | $964.77 | $86,655.99 |
24 | 7 | $303.30 | $968.15 | $85,687.84 |
24 | 8 | $299.91 | $971.54 | $84,716.30 |
24 | 9 | $296.51 | $974.94 | $83,741.36 |
24 | 10 | $293.09 | $978.35 | $82,763.01 |
24 | 11 | $289.67 | $981.77 | $81,781.24 |
24 | 12 | $286.23 | $985.21 | $80,796.03 |
Year 24 | $3,658.99 | $11,598.35 | $80,796.03 | |
25 | 1 | $282.79 | $988.66 | $79,807.37 |
25 | 2 | $279.33 | $992.12 | $78,815.25 |
25 | 3 | $275.85 | $995.59 | $77,819.66 |
25 | 4 | $272.37 | $999.08 | $76,820.58 |
25 | 5 | $268.87 | $1,002.57 | $75,818.01 |
25 | 6 | $265.36 | $1,006.08 | $74,811.93 |
25 | 7 | $261.84 | $1,009.60 | $73,802.33 |
25 | 8 | $258.31 | $1,013.14 | $72,789.19 |
25 | 9 | $254.76 | $1,016.68 | $71,772.51 |
25 | 10 | $251.20 | $1,020.24 | $70,752.27 |
25 | 11 | $247.63 | $1,023.81 | $69,728.45 |
25 | 12 | $244.05 | $1,027.40 | $68,701.06 |
Year 25 | $3,162.37 | $12,094.97 | $68,701.06 | |
26 | 1 | $240.45 | $1,030.99 | $67,670.07 |
26 | 2 | $236.85 | $1,034.60 | $66,635.47 |
26 | 3 | $233.22 | $1,038.22 | $65,597.25 |
26 | 4 | $229.59 | $1,041.85 | $64,555.39 |
26 | 5 | $225.94 | $1,045.50 | $63,509.89 |
26 | 6 | $222.28 | $1,049.16 | $62,460.73 |
26 | 7 | $218.61 | $1,052.83 | $61,407.90 |
26 | 8 | $214.93 | $1,056.52 | $60,351.38 |
26 | 9 | $211.23 | $1,060.21 | $59,291.17 |
26 | 10 | $207.52 | $1,063.93 | $58,227.24 |
26 | 11 | $203.80 | $1,067.65 | $57,159.60 |
26 | 12 | $200.06 | $1,071.39 | $56,088.21 |
Year 26 | $2,644.49 | $12,612.85 | $56,088.21 | |
27 | 1 | $196.31 | $1,075.14 | $55,013.07 |
27 | 2 | $192.55 | $1,078.90 | $53,934.17 |
27 | 3 | $188.77 | $1,082.68 | $52,851.50 |
27 | 4 | $184.98 | $1,086.46 | $51,765.03 |
27 | 5 | $181.18 | $1,090.27 | $50,674.77 |
27 | 6 | $177.36 | $1,094.08 | $49,580.68 |
27 | 7 | $173.53 | $1,097.91 | $48,482.77 |
27 | 8 | $169.69 | $1,101.75 | $47,381.02 |
27 | 9 | $165.83 | $1,105.61 | $46,275.41 |
27 | 10 | $161.96 | $1,109.48 | $45,165.93 |
27 | 11 | $158.08 | $1,113.36 | $44,052.56 |
27 | 12 | $154.18 | $1,117.26 | $42,935.30 |
Year 27 | $2,104.43 | $13,152.91 | $42,935.30 | |
28 | 1 | $150.27 | $1,121.17 | $41,814.13 |
28 | 2 | $146.35 | $1,125.10 | $40,689.03 |
28 | 3 | $142.41 | $1,129.03 | $39,560.00 |
28 | 4 | $138.46 | $1,132.98 | $38,427.02 |
28 | 5 | $134.49 | $1,136.95 | $37,290.07 |
28 | 6 | $130.52 | $1,140.93 | $36,149.14 |
28 | 7 | $126.52 | $1,144.92 | $35,004.22 |
28 | 8 | $122.51 | $1,148.93 | $33,855.29 |
28 | 9 | $118.49 | $1,152.95 | $32,702.33 |
28 | 10 | $114.46 | $1,156.99 | $31,545.35 |
28 | 11 | $110.41 | $1,161.04 | $30,384.31 |
28 | 12 | $106.35 | $1,165.10 | $29,219.21 |
Year 28 | $1,541.25 | $13,716.09 | $29,219.21 | |
29 | 1 | $102.27 | $1,169.18 | $28,050.03 |
29 | 2 | $98.18 | $1,173.27 | $26,876.77 |
29 | 3 | $94.07 | $1,177.38 | $25,699.39 |
29 | 4 | $89.95 | $1,181.50 | $24,517.89 |
29 | 5 | $85.81 | $1,185.63 | $23,332.26 |
29 | 6 | $81.66 | $1,189.78 | $22,142.48 |
29 | 7 | $77.50 | $1,193.95 | $20,948.53 |
29 | 8 | $73.32 | $1,198.12 | $19,750.41 |
29 | 9 | $69.13 | $1,202.32 | $18,548.09 |
29 | 10 | $64.92 | $1,206.53 | $17,341.56 |
29 | 11 | $60.70 | $1,210.75 | $16,130.81 |
29 | 12 | $56.46 | $1,214.99 | $14,915.83 |
Year 29 | $953.95 | $14,303.38 | $14,915.83 | |
30 | 1 | $52.21 | $1,219.24 | $13,696.59 |
30 | 2 | $47.94 | $1,223.51 | $12,473.08 |
30 | 3 | $43.66 | $1,227.79 | $11,245.29 |
30 | 4 | $39.36 | $1,232.09 | $10,013.21 |
30 | 5 | $35.05 | $1,236.40 | $8,776.81 |
30 | 6 | $30.72 | $1,240.73 | $7,536.08 |
30 | 7 | $26.38 | $1,245.07 | $6,291.01 |
30 | 8 | $22.02 | $1,249.43 | $5,041.59 |
30 | 9 | $17.65 | $1,253.80 | $3,787.79 |
30 | 10 | $13.26 | $1,258.19 | $2,529.60 |
30 | 11 | $8.85 | $1,262.59 | $1,267.01 |
30 | 12 | $4.43 | $1,267.01 | $0.00 |
Year 30 | $341.51 | $14,915.83 | $0.00 |
The Basics of Homebuying & How to Boost Mortgage Savings
Buying a home requires ample financial management and a level of stability. It’s one of the costliest possessions people purchase in a lifetime. Because of the large expense, it’s common practice to take out a loan to afford a house. Thus, a mortgage is one of the most important financial obligations you must fulfill, which usually takes decades to pay down.
Since it’s a major purchase, it’s only right to learn more about the homebuying process. First, you must qualify for a mortgage. This is when lenders assess your credit background, income, and overall financial standing. If you are a creditworthy borrower, you are likely to obtain favorable rates and terms. This helps you increase your mortgage savings.
When it comes to choosing the right loan, you must understand different types of payment structures that will suit your budget. Finally, it’s also important to know how your loan’s principal, interest rate, and payment term impacts the cost of your mortgage payment. To find out more, read our guide below.
Factors That Impact Mortgage Qualification
As you’ve likely heard, you must have a good credit profile to be eligible for a mortgage. Before securing a home loan, you must go through mortgage qualification screening. This involves the pre-qualification and pre-approval process. These steps allow lenders to evaluate if you have enough income to afford a home, and whether your financial background satisfies minimum requirements.
Pre-qualification is basically an initial evaluation of your creditworthiness. It provides a rough estimate of how much a lender might loan you based on self-reported financial details. This is a great way to gauge if you meet basic standards to afford a house. Pre-approval, on the other hand, is the formal assessment of your creditworthiness. Lenders verify your credit and income details by confirming with your credit bureau and employer. Receiving pre-approval is a more serious indicator that you’re ready to purchase a home.
Be sure to gather the following documents for your pre-approval application:
- At least 2 years of federal tax returns
- At least 30 days of pay stubs
- W-2 statement or 1099 from employers
- Quarterly statements of savings & checking accounts
- Documents of bonuses, alimony, social security, other income
Getting Pre-Approval Is Your Best Bet
When you obtain a pre-approval letter, it means a lender has thoroughly checked your credit history and verified your income. It’s a conditional guarantee to grant you a mortgage with a specific loan amount. This gives you the green light to shop around for a home, usually within a period of 60 to 90 days. Most home sellers also ask for a copy of your pre-approval letter before closing a real estate deal. Thus, getting pre-approval is your best move to secure a mortgage.
But before anything else, what exactly are lenders looking for? To qualify for a mortgage, you must meet the following standards. These are major indicators of your ability to pay back your mortgage.
Credit Score
Credit scores range between 300 to 850 and are based on details on your credit report. This includes your full payment history, such as how much you owe, and if you’ve missed payments before. A high credit score indicates you pay on time and manage your debt obligations well. To qualify for a conventional loan, most lenders approve a score of 680 and above. In other cases, you may be approved with a low score of 620. However, this usually means you’ll get a higher interest rate on your mortgage.
Income and Assets
Lenders assess if you have enough income to afford your mortgage and pay for other debts. Having a stable and secure job assures lenders you have a predictable source of income for mortgage payments. If you are self-employed, you must present enough proof that your business provides a sustainable source of income. You should also have assets such as savings or retirement accounts that prove you have extra funds in case of unemployment or business loss. Lenders also accept additional sources of income such as payments from overtime work, a part-time job, work bonuses, income from investments, or even child support benefits.
Debt-to-Income Ratio (DTI)
DTI ratio is a risk measurement that indicates how much of your monthly income pays for your debts. Specifically, DTI ratio is the percentage of your total monthly debts compared to your gross monthly income. There are two kinds of DTI ratios: Front-end DTI is the percentage of your income that pays for housing expenses. Meanwhile, Back-End DTI is the percentage of income that pays for housing expenses along with all other debts, such as credit card bills, car loans, students debts etc.
A higher DTI ratio means you’re not in good financial footing to acquire more debt. You will likely not be approved for a mortgage. On the other hand, a low DTI ratio means you have enough funds to pay for debt obligations. This lowers your risk to lenders, making you a more creditworthy borrower. Depending on the type of loan you choose, you must satisfy the required DTI ratio limits to secure a mortgage.
Improve Your Credit Profile
Before getting a mortgage, give yourself enough time to raise your credit score. You can fix credit issues by paying off high-interest debts, keeping your credit card balances low, and generally paying bills on time. This will increase your credit score, which may take 12 to 24 months to reflect. Reducing outstanding debt will also decrease your DTI ratio.
You can request a copy of your credit report at AnnualCreditReport.com. Borrowers can get a free credit report every 12 months. Review your credit history and check for record errors. Correcting errors with your credit reporting agency will also help raise your credit score. Again, a higher credit score gives you better chances of securing a more favorable mortgage deal.
Homebuyers should avoid major purchases or loans during the approval process. Buying a new car or applying for credit cards might prove to be a deal-breaker for your loan, so put it off until after you close.
How to Choose the Right Payment Structure
Once you qualify for a mortgage, it’s important to choose the right payment structure as well as the length of your term. Doing so will help you manage your budget, ensuring you can pay your loan on time. Mortgages come in two main payment structures: fixed-rate mortgages (FRM) and adjustable-rate mortgages (ARM). As for payment terms, the most common ones are 30-year terms. But you may also obtain 20-year, 15-year, and 10-year terms.
Fixed-Rate Mortgages (FRM)
Historically, the most widely purchased type of loan is a 30-year fixed-rate mortgage. This is because loans with longer terms come with cheaper monthly payments. And since fixed-rate mortgages come with locked rates, you have the benefit of the same predictable payments for the entire loan. Thus, FRMs are usually chosen by first-time homebuyers and consumers who want the security of fixed payments. If you have a tight budget, this is a suitable loan for you. It’s also ideal if you intend to live in your house for the long haul. But note that it’s usually harder to qualify for an FRM compared to an adjustable-rate mortgage.
Fixed-rate mortgages adhere to a traditional amortization schedule, which tells you the precise number of payments you need to make within the term. For example, a 30-year FRM comes with 360 payments spread throughout 30 years. However, note that 30-year FRM rates are generally higher by 0.25% to 1% than 15-year FRMs. The higher rate and longer term results in more expensive interest charges over the life of the loan.
Market Share Per Mortgage Type
According to the Urban Institute Housing Finance at a Glance, 30-year fixed mortgages accounted for 74% of new originations in September 2020. On the other hand, 15-year fixed-rate loans only comprised 17% of new mortgages, while ARMs only comprised 1.1% of the mortgage market share in September 2020.
Adjustable-Rate Mortgages (ARM)
ARMs, in contrast, have interest rates that eventually change after the introductory period. It typically starts off with a low rate, after which it increases or decreases depending on market performance. These come in 30-year terms and are typically taken as hybrid ARMs such as 3/1, 5/1, and 10/1 terms. For example, if you choose a 5/1 ARM, it means the introductory rate remains fixed for 5 years. After this period, your rate starts to adjust annually, which means you have to anticipate higher monthly payments. If rates continue to increase each year, you might have a hard time affording your mortgage payments.
Taking an ARM depends on your goals and your financial disposition. These are appropriate for people who plan to move and sell their house after a few years. If you’re buying a starter home and planning to move after five or so years, an ARM is a viable option. Since it usually has a low initial rate, it’s attractive to certain borrowers. On the other hand, borrowers who initially cannot qualify for a fixed-rate mortgage may take an ARM and eventually refinance their mortgage into a fixed-rate loan.
Ideally, you can start selling your house before the introductory period ends, so you don’t have to make higher monthly payments. House flippers who purchase real estate at a discounted price also use ARMs. After they’ve made improvements on the house, they sell it in the market for a much higher price. Meanwhile, other borrowers with ARMs try to refinance into a fixed-rate loan before the introductory period ends.
Generally, ARMs are much easier to qualify for compared to fixed-rate mortgages. Experian states that ARMs are a common type of subprime mortgage. The changing rate makes it easy for lenders to earn more interest on the mortgage. However, it spells bad news for borrowers when rates increase payments. And since they are initially affordable, they are also attractive to homebuyers with good credit.
Make Sure You Can Afford Higher Payments
If you cannot sell or refinance your house as scheduled, you must be prepared to have enough funds for higher payments. Ideally, you should be able to afford it even if the loan reaches its rate cap. This is the maximum limit your rate can increase over the life of the loan. If you do not have enough funds, you risk defaulting on your loan. To avoid this, many ARM borrowers eventually refinance into a fixed-rate mortgage to secure a lower rate.
Comparing Fixed vs ARM Loans
To recap the differences between fixed-rate loans (FRM) and adjustable-rate mortgages (ARM), we created the chart below:
Loan Details | FRM | ARM |
---|---|---|
Best fit for: | Borrowers who want stable, predictable payments Borrowers who will live long-term in their home Borrowers who can afford monthly payments at market rates Borrowers who believe interest rates will increase | Borrowers who will move in a few years and sell their home Borrowers who need low monthly payments who will later refinance into FRM Borrowers who believe market rates will likely decrease House flippers who buy, renovate, and resell homes |
Not ideal for: | Borrowers who have poor credit Borrowers who can’t afford an expensive upfront payment | Borrowers who want the assurance of predictable payments Borrowers who cannot afford higher monthly payments when rates rise |
Benefits: | No need to worry about increasing mortgage payments; avoid payment shock Rate remains the same even if market rates rise | Typically charges low rates during the introductory period Low upfront monthly payments |
Drawbacks: | Borrowers pay large interest on a 30-year term compared to a shorter term If you want to save on interest, you must refinance to a shorter term or make extra payments on your mortgage | Once the introductory period ends, monthly payments can increase You’ll experience payment shock, have trouble making payments if market rates continue to rise |
Factors That Make Up Mortgage Payments
Next, to maximize your savings, you must learn the basic components of your mortgage payments. It’s worth understanding the factors that increase or decrease your payments, and what you can do to reduce its overall cost.
A mortgage has three primary components that determine your monthly payment:
1. Principal – this is the loan amount
2. Interest Rate – based on the annual percentage rate (APR)
3. Loan Term – this is the length of your payment duration or the number of payments
Principal
The principal is the actual loan amount you borrowed from your lender. The greater the principal amount, the higher your monthly payment. To lower the principal amount, you can put forward a higher down payment. Let’s take the example below to illustrate how this works.
Using our calculator above, let’s compare the monthly payment between a 10% down and a 20% down. Suppose your home is valued at $350,000 and you’re taking a 30-year FRM at 3.5% APR.
30-Year FRM
Home Price: $350,000
Interest Rate: 3.5%
Loan Details | 10% Down Payment | 20% Down Payment |
---|---|---|
Down Payment Amount | $35,000 | $70,000 |
Principal Loan Amount | $315,000 | $280,000 |
Monthly Mortgage Payment | $1,414.49 | $1,257.33 |
Total Interest | $194,216.68 | $172,637.05 |
*The calculations above and below only include principal & interest; they do not include property taxes & homeowner’s insurance.
Making a larger down payment significantly diminishes the size of your principal. In the example above, a 10% down reduces your principal to $315,000, while a 20% down further decreases your principal to $280,000. If you pay 10% down, your monthly payment will cost $1,414.49. Meanwhile, with 20% down, your monthly payment is further reduced to $1,257.33. That’s savings worth $157.16 per month.
Moreover, savings are more noticeable when you compare the overall interest costs. With a 10% down, your total interest charges amount to $194,216.68. But with 20% down, your total interest costs are reduced to $172,637.05. In this example, you’ll save $21,579.63 in interest over the life of the loan.
Save for a 20% Down Payment
Financial advisors recommend making a 20% down payment on your mortgage. Besides reducing your monthly payments and boosting your interest savings, paying 20% down eliminates private mortgage insurance (PMI) on a conventional loan. PMI is an extra cost that’s around 0.5% – 1% of your annual loan amount. This is only removed once you reach 78% of your mortgage balance.
Interest Rate
Interest is the amount lending institutions charge for servicing loans. When you take out a mortgage, you commit to paying it back with an assigned rate of interest. While the interest rate is determined by local and economic factors, your credit score will largely influence whether you’ll obtain a low or high rate.
The most widely used credit rating system is the FICO score (Fair Isaac Corporation). Essentially, the higher your credit score, the lower the interest rate you can obtain. FICO publishes estimated rates on their Home Purchase Center page, with corresponding credit scores and monthly payments.
Here are example rates from December 10, 2020. It’s based on the national average rate for a principal loan amount worth $300,000.
FICO Score Range | Interest Rate (APR) | Monthly Mortgage Payment |
---|---|---|
760 – 850 | 2.378% | $1,166 |
700 – 759 | 2.600% | $1,201 |
680 – 699 | 2.777% | $1,229 |
660 – 679 | 2.991% | $1,263 |
640 – 659 | 3.421% | $1,334 |
620 – 639 | 3.967% | $1,427 |
Based on the chart above, you’re likely to obtain more competitive rates with a higher credit score. Thus, it’s crucial to fix credit issues before applying for a mortgage. A lower rate will not only reduce your monthly payment. It will also decrease the overall interest you’ll pay over the life of your loan.
The following example compares the same loan with different interest rates. The first one has 3.5% APR, the second one is 3% APR, and the third one is 2.5% APR. Review the results below.
30-Year FRM
Principal Loan Amount: $280,000
Loan Details | 3.5% APR | 3% APR | 2.5% APR |
---|---|---|---|
Monthly Mortgage Payment | $1,257.33 | $1,180.49 | $1,106.34 |
Total Interest | $172,637.05 | $144,976.87 | $118,281.87 |
The example above shows you’ll boost your interest savings with a lower interest rate. At 3.5% APR, your total interest will amount to $172,637.05. But if the APR is reduced to 3%, the total interest decreases to $144,976.87. This saves you $27,660.18 in interest charges. But if your interest rate is 2.5% APR, your total interest decreases to $118,281.87. Compared to 3.5% APR, this saves you a total of $54,355.18 in interest costs.
Apart from improving your credit score, make sure to shop around for different rates. Check at least three different lenders. It’s best to look around to ensure you can secure the most favorable rate.
Loan Term
The loan term refers to the agreed time you should pay down your mortgage. For fixed-rate mortgages, the term tells you the precise number of fixed payments needed to pay off a loan. For instance, 30-year FRMs require 360 monthly payments, while 15-year FRMs require 180 monthly payments. As long as you make payments within the agreed term, your mortgage should be paid off by the due date.
The length of your loan term also determines whether your payments will be affordable or expensive. Again, 30-year terms come with cheaper monthly payments. However, the longer your term, the greater interest charges accrue. Meanwhile, shorter terms such as 15-year FRM have higher monthly payments. But since it pays off your mortgage in half the time, it incurs much lower interest charges. 15-year FRMs also have rates that are lower by 0.25% to 1% than 30-year FRMs.
The following example compares two mortgages with the same loan amount but with different terms.
Principal Loan Amount: $280,000
Loan Details | 15-Year FRM | 30-Year FRM |
---|---|---|
Rate (APR) | 3.2% | 3.5% |
Monthly Payment | $1,960.68 | $1,257.33 |
Total Interest | $72,921.56 | $172,637.05 |
According to this example, the monthly payment for the 15-year FRM is higher by $703.35 than the 30-year FRM. You’ll notice the monthly payment decreases when the loan term is extended to 30 years. However, when it comes to total interest, the 15-year FRM costs $72,921.56, while the 30-year FRM costs $172,637.05 in total interest. The 15-year FRM saves you $99,715.49 in interest charges compared to the 30-year loan.
Though shorter terms such as 15-year FRMs boost interest savings, not everyone can afford the higher monthly payments. Many people still end up taking a 30-year FRM. But don’t worry. There’s still a way to shorten your term and reduce your interest costs. You can do this by making small extra payments on your mortgage.
Loan Amortization
Mortgage Amortization Formula
Mortgage calculation is one of the few places your algebra classes come in handy, but it's a lot more complicated than you remember, especially considering all the variables involved in a home loan.
The formula used to calculate monthly principal and interest mortgage payments is:
P = V[n(1 + n)^t]/[(1 + n)^t - 1]
Where
- P = Monthly payment amount
- V = Loan amount
- t = Total number of payments / term of loan in months
- n = Monthly interest rate as a decimal (This is the annual interest rate divided by 12. For example, a 6% APR becomes 0.005 per month.)
The above figues out the core loan payment. To get a full picture of the cost of ownership one would also add other costs of homeownership including things like:
- real estate taxes
- homeowners insurance
- private mortgage insurance (PMI)
- maintenance
- HOA dues
The Amortization Schedule
When you take the principal, interest rate, and loan term to estimate mortgage payments, you can calculate a full amortization schedule. An amortization schedule is a table that details the number of loan payments you must make for the entire duration of your mortgage. It shows how much of each payment goes toward your interest and principal balance each pay period.
An amortization schedule indicates the following mortgage details:
- Payment date or number
- Beginning and ending balance
- Interest paid
- Principal paid
During the start of your mortgage, a large portion of your payments are applied toward the interest. But towards the latter half of your loan, a larger part of your payments goes toward paying your principal. Depending on how far along you are in your payments, you can use the amortization schedule to determine how much you still need to pay to clear your debt. And if you apply extra payments toward the principal, this decreases the principal and reduces your interest charges.
You can use our calculator above to generate your own amortization schedule.
Making Extra Mortgage Payments
Extra payments on your mortgage have the most impact during the early years of your loan. Since the principal is largest during the first years, this gradually reduces your principal loan amount, which lowers your interest charges. You can ask your lender to directly apply your extra payments toward the principal.
However, before making additional payments, make sure to ask your lender about prepayment penalty. This is an added fee that usually takes effect during the first three years of a mortgage. You can wait for the prepayment penalty to lapse before making extra payments. Most conventional mortgages have a prepayment penalty clause, though you can secure a loan without one. Meanwhile, government-backed mortgages such as FHA loans, USDA loans, and VA loans do not require prepayment penalties. You can prepay your mortgage anytime without worrying about expensive costs.
In Summary
Homebuying can be an overwhelming process, especially if you’re not familiar with certain terms. But with ample knowledge about the market and your mortgage options, you can secure a good deal while maximizing your savings.
First, you should undergo the mortgage qualification process, such as pre-qualification and pre-approval. Pre-approval is an informal estimate of how much you might borrow. It’s also a good way to see if you meet basic mortgage requirements. Meanwhile, pre-approval is a formal evaluation of your creditworthiness based on verified financial information. Once you receive a pre-approval letter, you have a go-signal to shop for homes within 60 to 90 days. Before applying for a mortgage, it pays to have a high credit score, a low DTI ratio, and a stable source of income. Satisfying these factors increases your chances of getting loan approval.
Next, you must choose the right type of payment structure for your loan. There are two main payment structures for mortgages: Fixed-rate mortgages (FRM) and adjustable-rate mortgages (ARM). FRMs are usually chosen by first-time homebuyers and borrowers who prioritize predictable payments for the entire loan. On the other hand, ARM rates change depending on market conditions, which means payments can increase over time. People who choose ARMs plan to move and sell the house after a few years. Some buyers also choose ARMs for the low introductory rate. To avoid increasing payments, many ARM borrowers eventually refinance into an FRM to lock in a fixed rate.
It’s also important to learn different factors that determine your monthly payment. These include the principal, interest rate, and loan term. A large principal means higher monthly payments and total interest charges. To reduce your principal, it’s worth making a 20% down payment. A high interest rate, meanwhile, yields higher interest charges over the life of the loan. To secure a lower rate, try to improve your credit score before applying for a mortgage. As for the loan term, longer terms such as 30-year FRMs have affordable monthly payments. However, it generates expensive interest charges. In contrast, shorter terms like 15-year FRMs have higher payments but help you save a great deal on interest costs.
As a final note, consider making extra payments on your mortgage to boost interest savings and shave a couple of years off your term. Small extra payments can help decrease your principal, which reduces your loan’s interest charges. Just be mindful of prepayment penalty rules to avoid expensive fees. If your loan has a prepayment penalty clause, you can wait for it to lapse before making additional payments.
Ashburn Borrowers: Are You Unsure Which Loans You'll Qualify For?
We have partnered with Mortgage Research Center to help Ashburn homebuyers and refinancers find out what loan programs they are qualified for and connect them with Ashburn lenders offering competitive interest rates.