Methodology

Fixed-rate payment

For a fixed-rate loan, monthly principal and interest is calculated using M = P × [r(1+r)^n] / [(1+r)^n − 1], where P is loan principal, r is the monthly interest rate, and n is the number of monthly payments.

If the interest rate is 0%, the payment is principal divided by the number of months.

Total housing payment

The standard calculator adds monthly principal and interest, property taxes, homeowners insurance, PMI entered by the user, and HOA entered by the user. Property tax is estimated as home price × annual tax rate ÷ 12.

Amortization

Each month, interest equals the opening balance multiplied by the monthly rate. The remainder of the scheduled payment reduces principal. Extra payments are applied to principal.

Reverse affordability

The budget-to-price calculator uses a numerical binary search to find a home price whose estimated monthly housing payment is approximately equal to the user's target. This is useful because property taxes depend on the home price itself.

Points break-even

The calculator compares the difference in upfront cost with the difference in monthly principal-and-interest payment. When the higher upfront cost produces monthly savings, break-even is estimated as upfront-cost difference divided by monthly savings.

Important limitations

Actual lender calculations, fees, escrow requirements, taxes, insurance, mortgage insurance, eligibility, and available rates can differ. The calculators do not model adjustable-rate mortgages, lender-specific underwriting, debt-to-income qualification, closing costs, tax deductions, or investment opportunity cost unless explicitly stated.