Tools in This Collection
Mortgage Calculator
Calculate monthly mortgage payments with principal, interest, taxes, insurance, and amortization
Refinance Break-Even Calculator
Calculate refinance monthly savings, total interest saved, and break-even point in months
HELOC vs Home Equity Loan Calculator
Compare HELOC vs home equity loan monthly payments, total interest, and trade-offs
Home Affordability Calculator
Calculate how much house you can afford using the 28/36 DTI rule from your income and debts
Mortgage Points Calculator
Calculate if buying mortgage discount points is worth it with break-even payback analysis
PMI Removal Date Calculator
Find when you'll reach 20% equity and can request PMI removal with monthly savings estimate
Closing Costs Calculator
Estimate home buying closing costs by state with itemized breakdown of all fees
Home Equity Calculator
Calculate current home equity, LTV ratio, and HELOC borrowing capacity
Guides & Articles
Mortgage and Home Financing Workflow
A home purchase is typically the largest financial transaction most people will ever make. The financing decision — down payment, loan type, rate vs points trade-off — has a compounding effect over the loan term. Even a 0.5% rate difference on a $400K mortgage changes total interest paid by over $40,000 over 30 years.
Step 1: Set a Realistic Affordability Range
Mortgage lenders use the 28/36 DTI rule: your housing payment should be under 28% of gross monthly income, and total debt payments under 36%. The Home Affordability Calculator works backward from income, existing debts, and down payment to estimate the maximum loan amount a lender will approve. Building in a cushion below that maximum — ideally 10-15% — protects against rate increases, maintenance costs, and financial emergencies.
Step 2: Calculate the True Monthly Payment
The mortgage payment isn't just principal and interest. Property taxes, homeowner's insurance, and PMI (if down payment < 20%) add significantly to the monthly outlay. A $300K loan at 6.5% has a $1,896 P&I payment, but total PITI (principal, interest, taxes, insurance) on a $350K home in a moderate-tax area is often $2,400-$2,600. The Mortgage Calculator shows the full payment breakdown including an amortization schedule.
Step 3: Evaluate Refinancing Opportunities
Refinancing makes sense when the rate reduction saves enough in monthly payments to recoup the closing costs within a reasonable timeframe. The Refinance Break-Even Calculator shows the exact break-even month. For a 1% rate reduction on a $300K loan with $6,000 in closing costs, break-even is typically 18-24 months — meaning refinancing makes sense if you'll stay 3+ years.
Frequently Asked Questions
How much house can I afford on a $100,000 salary?
Using the 28% front-end DTI guideline: $100,000 gross annual / 12 = $8,333/month × 28% = $2,333 max housing payment. At 6.5% over 30 years, $2,333 monthly supports approximately $370,000 in loan principal. Add your down payment to get the max purchase price. Actual approval depends on your other debts, credit score, and lender criteria.
When should I refinance my mortgage?
General rule: refinance when you can reduce your rate by at least 0.5-1% and you plan to stay long enough to recoup closing costs. The Refinance Break-Even Calculator shows your exact break-even month. If you'll move or sell before break-even, refinancing costs more than it saves. High-rate environments can create refinancing opportunities as rates drop — watching the break-even period is more important than any single rate threshold.
What is PMI and how do I avoid it?
PMI (private mortgage insurance) is required by most conventional lenders when your down payment is under 20%. It typically costs 0.5-1.5% of the loan amount annually, added to your monthly payment. To avoid it: put 20% down, use an 80/10/10 piggyback loan structure, or accept PMI and eliminate it once you reach 20% equity (lenders are required to cancel at 22%). The PMI Removal Calculator shows when you'll hit the elimination threshold.
Are mortgage discount points worth buying?
Each point costs 1% of the loan amount and typically reduces your rate by 0.25%. On a $300K loan, 1 point costs $3,000 and might save $45/month. Break-even is $3,000 / $45 = 67 months (5.5 years). Buying points only makes financial sense if you're certain you'll keep the loan longer than the break-even period — which is uncertain given refinancing and mobility.
What is the difference between a HELOC and a home equity loan?
A HELOC (Home Equity Line of Credit) is a revolving line — you can draw, repay, and redraw during the draw period (typically 10 years), with variable interest rates. A home equity loan is a lump sum at a fixed rate repaid over a fixed term. HELOCs are better for unpredictable ongoing expenses. Home equity loans are better for a specific large expense where you want payment certainty.