Sunday, July 08, 2018

What will your monthly mortgage payment be?

Here's an easy way to calculate what your mortgage, tax and insurance payment will be every month if you buy a home here in So. Cal.

First, THIS IS JUST AN ESTIMATE CALCULATION. Your payment may be different, but let's assume for now that all other things are equal -- you have good credit, lack excessive debt, and are putting 20% down on your home purchase.  Now, divide the purchase price in half and take off two zeros (or use one of the many great online calculators).

- $500,000 purchase price = $2500 month mortgage, tax, insurance (called PITI).
- $1,000,000 = $5000/mo PITI
- $1,200,000 = $6000/mo PITI
- $1,500,000 = $7500/mo PITI

...And so on.  Condo and townhouse buyers will need to add their HOA dues on top of this.

It's really important to know that the Federal Reserve intends to raise rates more this year, so these numbers are just for now.  Yes, property taxes and insurance are still somewhat deductible from your taxes, but the numbers above reflect the outgoing cost each month.

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