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Your mortgage payment has two parts: principal (paying down the loan) and interest (the bank's fee). In the first years, most of your payment goes to interest. Use our mortgage calculator to see the exact split.
On top of P&I, budget for property taxes (varies by location), homeowner's insurance (~$1,500/year), and PMI if your down payment is under 20%.
With a $350K home, $70K down (20%), 6.75% rate:
Lenders use the 28/36 rule: housing costs should be under 28% of gross income, and total debt under 36%. On a $100K salary ($8,333/month), aim for a mortgage payment under $2,333.
On a $280K loan for 30 years: at 5% you pay $1,503/month. At 7% you pay $1,863/month. That's $360/month — $129,600 over the life of the loan. Even a 0.5% rate difference adds up to tens of thousands.
Open the mortgage calculator, plug in your home price, down payment, and current rates, and see exactly what you'd pay monthly and over the life of the loan.
Try the Mortgage Calculator — free, private, unlimited.
Open Mortgage CalculatorThe 28% rule: your mortgage payment should be under 28% of gross monthly income. On $75K, that's $1,750/month max. At 7% for 30 years with 20% down, you can afford roughly a $300K home.
A 15-year mortgage saves you hundreds of thousands in interest but has higher monthly payments. Use our calculator to compare — on a $300K loan at 7%, a 15-year saves $232K in interest vs a 30-year.
If possible, yes. Under 20% means paying PMI ($50-200/month extra). But waiting years to save 20% while renting might cost more than PMI would. Run the numbers for your situation.