Real Estate Mortgage Calculator
A mortgage is the foundation of nearly every home purchase. Most buyers need a mortgage in order to purchase a home in Raleigh. The good news is that there are quite a few solutions available, so you’re sure to find a mortgage that fits your budget and lifestyle. Review some common mortgage options, and calculate your predicted monthly payments based on the prices of homes you like in Raleigh.
To get a more specific estimate of your monthly costs, contact Sal Stammetti today, or read more about buying a home in Raleigh.
Types of Mortgages
Generally speaking, there are two basic types of mortgages used by most homebuyers in Raleigh: conventional and government-backed. Determining which is right for you depends on a number of factors, including your credit score, the amount of your down payment, the location of the property, and much more. Sal Stammetti can help you find a lender that will explain your options in detail.
Conventional loan
This is the standard mortgage you'll find at a bank or credit union. These are often used by buyers with good to excellent credit, and they require 20% down to avoid making PMI (private mortgage insurance) payments each month. Conventional loan rates can either be fixed or adjustable.
Government loan
Government mortgages offer looser financial qualifications, and are often targeted to buyers with lower credit scores, down payments, or income. These loans are offered by government agencies such as the Federal Housing Administration (FHA), the U.S. Department of Agriculture (USDA), and the U.S. Department of Veterans Affairs (VA).
What Do Mortgages Include?
There are four main components to a mortgage payment, often abbreviated as "PITI."
Principal
This is the repayment of the initial amount you borrowed from your lender (in other words, the price of your home).
Interest
This is a payment to the lender for the money borrowed (which is then added on to the initial price of your home).
Taxes
Your annual city and county taxes assessed on your property are divided equally and added to your monthly payments.
Insurance
Homeowner's insurance is also added to your monthly payment and protects your property against hazards.
Understanding Your Mortgage Options
Before you decide on any particular loan, take the time to do some research. Sal Stammetti's experts recommend meeting with at least two, if not three, different mortgage lenders to find the deal that works for your lifestyle. A component of your loan's affordability will be the type of interest rate.
Fixed-rate loan
You may hear "mortgage" and immediately think "30-year fixed." That's because this is the most common rate type on a conventional loan. The interest does not change for the life of the loan, unless you choose to refinance, so your monthly payments are predictable and stable.
Adjustable-rate loan
An adjustable-rate loan offers the initial stability of a fixed-rate loan, with the interest rate fixed for a certain amount of time after the loan is originated. Then, the rate will change after that introductory period. You can often save money on monthly payments with a lower rate to start.
Calculating Your Monthly Budget
Now that you know what loan options are available to you, it's time to determine how much you can afford to pay every month. Use our free and easy mortgage calculator below to calculate your monthly payments at different home prices and with different interest rates, down payments, tax rates, and more. Let’s find your dream home in Raleigh!