How do I calculate my mortgage payment?
Although most people use a mortgage calculator like this one to figure out their mortgage payment, a few still prefer to do it the old-fashioned way. If that's you, use this formula below to give it a whirl:
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The number that you get at the end of that formula is your base mortgage payment, made up of just principal and interest. Although that is technically a mortgage payment, these days most mortgage servicers will also include taxes and insurance in your payment, too. That's why it's now commonly referred to as PITI (principal, interest, taxes, insurance).
Most mortgage payments today also include expenses like mortgage insurance (PMI for conventional loans or MIP for FHA loans), HOA dues, and additional coverages like flood insurance or wildfire coverage. All of these costs taken together are what most people think of when they think about their mortgage payment.
To calculate your new mortgage with these additional expenses included, just click "show additional inputs" on the mortgage calculator above and add your estimated figures. It will get you a very close estimate of what monthly payment to expect.
Things to know before buying a house in New Hampshire
Not only are New Hampshire real estate prices soaring, the taxes you'll pay on that real estate can be significant. New Hampshire has the 2nd highest property taxes in the country, at 1.86% of a property's assessed fair market value. That means that if your home is assessed at $249,700, you'll pay $4,636 in taxes this year.
On top of being very expensive, New Hampshire is experiencing very serious effects from climate change. The state has warmed about twice as much as the rest of the country, which is causing the intensity of both flood and drought to increase dramatically. Coastal flooding is also a significant risk, as sea levels rise and wetlands continue to erode. If you're buying on the coast, be prepared for more impactful storms, higher storm surge, and more infrastructure damage with storms.
Your basic homeowners insurance may not cover new hazards that are threatening New Hampshire, so be sure to ask your insurance agent what coverage you may need in the near future. Having a flood insurance policy before you need it, for example, will save you a lot of money when the flood no one expected finally hits. You can plug the insurance prices you get into the New Hampshire mortgage calculator to help give you a better estimate of your overall payment.
Tips for first-time home buyers in New Hampshire
New Hampshire Housing offers four different programs that can be used by first-time home buyers who need assistance with down payments or closing costs. Each requires you to be a first-time home buyer and meet both income and purchase requirements, but other terms vary.
Home First
The Home First program offers New Hampshire residents up to $10,000 to put toward their closing costs and down payment in the form of a second mortgage. This loan has a 0% interest rate and no payment due unless you refinance or sell your home.
Home Flex Plus
Home Flex Plus is forgivable down payment and closing cost assistance that can be used in conjunction with FHA, VA, and USDA loans. It offers up to 2% of the home's loan amount as a second mortgage with a 0% interest rate and no payment due. After five years, the loan is forgiven entirely.
Home Preferred Plus
The Home Preferred Plus program is very similar to the Home Flex Plus program, except for borrowers using conventional loans. It's also for up to 2% of the home's loan amount and forgivable after five years, with no payment due before that.
First Gen NH
If you've never owned a home, and your parents never owned a home, you may additionally qualify for the First Gen NH program. This is a five-year forgivable $10,000 second mortgage with a 0% interest rate and no payments due that can be added to any other first-time home buyer programs in New Hampshire.
Advice for all first-time borrowers
Buying a home in New Hampshire may be a significant challenge, so you want to show up as the best version of yourself for your loan application. Your lender won't just look at your credit score, it will also look at your entire financial picture to make sure you can afford your home well into the future. This includes:
- Verifying that you've been employed at the same place for at least two years.
- Checking your bank accounts to ensure that your funds are seasoned, meaning they've been in your account for at least 60 days and their source can be verified.
- Checking your debts against your income to figure out how much house you can really afford based on your financial situation.
- Looking at your credit file to ensure you've been making all your payments on time and none of your credit lines are too over-utilized.
Along with this first check of your credit profile, underwriting will do a second check very close to your closing day. The lender will want to see that everything is basically the same as it was the first time it was checked, and if it isn't, there can be dire consequences -- up to and including your loan approval being withdrawn.
So, in the period between your loan pre-approval and your closing day, don't do anything unexpected, don't buy anything you don't have to, and guard your credit well. This is the most important time for absolutely nothing exciting to happen.
Fact Checked
Ashley Maready
