Believe it or not. Mortgage payment calculation estimates can vary significantly based on which state you live in and can vary even within cities and counties. Property tax amounts are the main culprit. Some states have really expensive taxes while others are relatively inexpensive. Utah falls into the middle group. Here is how to estimate a payment correctly:
Gross annual income - This is the combined amount of household income you receive before any taxes are taken out of your paycheck.
Monthly Debt Payments - Auto loan payments, monthly minimum credit card payments, student loan payments, and any other debts you pay on monthly. Only use the minimum required payment for each account.
Conventional Loan Down Payment - First Time Homebuyers can use as low as 3%, Regular buyers use 5%, 20% allows you to not need mortgage insurance for Conventional Loans.
FHA Loan Down Payment - 3.5% is the minimum - 5-10% allow the monthly mortgage insurance on an FHA loan to drop off after 11 years. Otherwise, FHA mortgage insurance is permanent.
VA Loan Down Payment - No down payment is required but you will be required to pay a few thousand in closing costs and to set up an escrow account for taxes and insurance. Learn more about VA Loans.
USDA Loan Down Payment - No down payment is required but you will be required to pay a few thousand in closing costs and to set up an escrow account for taxes and insurance. Find out more about USDA Loans in Utah.
Annual Interest Rate - Do your best to estimate where current rates are. You can always contact us for help.
Private Mortgage Insurance - This is required on any FHA or Conventional loan where the down payment amount is less than 20%. It can be paid monthly, upfront, or the lender can pay it and give you a higher rate. Estimate between .2% and .5% of the loan amount. Higher credit and multiple borrowers on a loan are helpful.
Monthly Insurance - This is your homeowners insurance estimate. A good general rule is to use .125% of the loan amount. (.00125 * your loan amount)
Monthly Property Taxes - This is your property taxes due to the county. A general rule of thumb is to use .027% of your loan amount. (.00027 * your loan amount)
Length of Mortgage - This is your mortgage loan term. Most people stick with 30 years.
Feel free to reach out to us if you have any questions or need help estimating your mortgage payment. Contact us today at 801-820-7620.
Let us help you navigate the mortgage process with ease. We are here to guide you to your dream home in Utah. Learn more about The Tim Hawkes Team and explore our various mortgage services, including debt consolidation, calculating mortgage, refinance options, and reverse mortgages.
For first-time homebuyers in Utah, we offer Down Payment Assistance Programs to help you achieve your dream of homeownership. If you are considering cash-out refinance for home improvements or to pay off high-interest debts, we can assist you with that too.
Are you interested in government-backed loans? Explore options like FHA loans, VA loans, and USDA loans to find the right fit for your needs.
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To make informed decisions, explore our helpful Glossary of mortgage-related terms and get insights into the loan process and paperwork involved.
Protect your financial future and explore options like reverse mortgage for seniors.
We are your trusted mortgage advisors, dedicated to helping you find the right loan options. Reach out to us today to get started on your homeownership journey. Call us at 801-820-7620 or visit our website for more information.
Whether you are a first-time homebuyer or looking to refinance your existing mortgage, our team is here to assist you every step of the way. Explore our resources like the Renting Versus Buying Calculator and the How Much Can I Afford Calculator to make well-informed decisions.