Can You Afford to Buy a House? Try a Mortgage Calculator with Taxes and Insurance

Buying a house is one of the biggest financial estimates most of us will ever make. As you get older, the idea of purchasing a home shifts slowly from a daunting expense to an essential one.

Maybe you have a growing family and need more space, or perhaps you have finished paying off college loans and are accumulating enough wealth to loosen the purse strings a little. Even so, buying a home is never something you should do without careful consideration and analysis of your finances—even if you are buying your third or fourth home instead of your first. Using a mortgage calculator with taxes and insurance can help you gain a better understanding of how buying a house will affect your monthly expenses and how much house you can actually afford.

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Finding the Right Mortgage Calculator

There are many mortgage calculators around the web, and as with anything else, some are better than others. Some mortgage calculators will only tell you what a monthly mortgage payment will be based on house price, interest rate, down payment, and length of the loan. Others will use your annual income, your debt, your expenses, your credit score, and other factors to tell you how much house you can afford.

San Diego Purchase Loans offers three different mortgage calculators to work with, each of which can help you look at buying a house from a different angle. If you are weighing your options as far as real estate is concerned and aren’t quite ready to talk to a bank yet, these calculators give you the tools you need to run multiple calculations and make key determinations about your purchase plans and goals.

Deciding to buy a house isn’t like flipping a switch—at least not in most cases. It isn’t an impulse decision that happens in a split second. Instead, making the choice to start shopping for a new home is a process, one where you weigh your finances against your needs and try to decide what is the smartest path forward for yourself and your family. Fittingly, there is a mortgage calculator that is right for the different stages of this decision-making process.

The Home Price Calculator: A Mortgage Calculator with Taxes and Insurance

If you are already fairly certain that you want to buy a house and are trying to get a firm sense of what the transaction would mean for your finances, you should use the “Home Price” mortgage calculator from San Diego Purchase Loans. This mortgage calculator is designed to tell you how much money you can expect to pay each month if you buy a house. By inputting your house price, the interest rate, the length of the loan, and your preferred down payment, you can get the calculator to estimate (most of) your monthly housing expenses for you.

Say you are looking at a house with an asking price of $187,000 and you are prepared to put $30,000 down. With a 4.25% interest rate and a 30-year mortgage, the calculator would tell you to expect $1,081 in monthly expenses. These expenses include $772 in P&I (or Principal and Interest, your actual mortgage payment), $187 in property taxes, $75 in home insurance, and $47 in PMI. (PMI stands for “private mortgage insurance,” which only applies if your down payment is less than 20% of the total price of the home.)

By default, the calculator figures out your insurance and property tax costs based on averages. If you know what you would be paying, you can click “Advanced” on the calculator and input those specific numbers. You can also include homeowner association dues if you are shopping in a neighborhood where such fees apply. For even more accurate calculations, do a Google search for today’s interest rates and input the relevant rate into the calculator.

Keep in mind that this calculator does not give you the full picture of what your monthly housing expenses will be. You will still have to pay water, sewer, electric, and gas bills, which can add significantly to your final ledger. However, because the “Home Price” calculator from San Diego Purchase Loans is a mortgage calculator with taxes and insurance, it does give you a more realistic portrait of your likely monthly expenses than some other mortgage calculators.

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Other Mortgage Calculators (And When You Should Use Them)

San Diego Purchase Loans also offers two other mortgage calculators: the “Income” calculator and the “Monthly Payment.” These calculators are generally good for earlier in the decision-making process when you haven’t seen any houses yet or started thinking seriously about buying but are just trying to figure out whether buying a home fits realistically into your current financial profile.

The “Income” calculator is useful to see where your absolute ceiling is for home value. By inputting how much money you make each year, what your monthly debts look like (e.g. monthly car payments, student loan payments, or similar), the interest rate and length of your likely mortgage payment, and how much cash you have on hand to put down, you can find out what kind of house value and monthly payment is feasible for you. This calculator is useful for carving out a budget range for your home. If the calculator tells you that the most expensive house you can afford is $200,000, it’s a waste of your time to look at homes that are closer to the $300,000 price range.

The “Monthly Payment” calculator offers another way to determine your house budget. You know how much money you spend each month and what kind of living expenses you can handle. This calculator allows you to input your preferred monthly payment and calculate your optimal home price from there. For instance, if you want a monthly payment of $900 and can afford to make a down payment of $25,000, then you will likely be looking for a home somewhere in the neighborhood of $200,000.

Try a Mortgage Calculator Today!

Are you starting to think about buying a house? See how a residential investment would affect your finances. Click here to try a mortgage calculator with taxes and insurance today!

Testimonials

“Chad and his entire team were over the top amazing, professional, and attentive throughout the entire home loan/buying process. I could not have asked for a better team to have on my side through what could be one of the most challenging and stressful processes one experiences. From the first conversation I had with Chad, I felt comfortable with him. He helped guide us through the process without ever once making us feel uneasy, unimportant, or uninformed. I never felt silly or stupid for asking the same questions over and over until I fully understood what we were getting into, or until something made total sense to me. The home loan world is fast paced, overwhelming, and confusing, and Chad and his team held our hands and helped us to feel comfortable and confident about our choices. He and his team were always there for us day or evenings, weekdays, or weekend and never made you feel like you were a bother if you had a burning question you had to get answered at 8pm Saturday night. I will use them again and again, and suggest them to any friend, family, or acquaintance. Seriously, they are rock stars. They work hard for you to get you into your dream home, we could not be happier with their hard work, dedication, and kindness.”

“Juliann – Thank you very much for your patience and help with everything. I can say 150% that we could not have gotten through this without you. I have been through this process before a few times BUT never have received this type of care/attention. This process is intense and you managed to humanize this life changing experience for us – rather than being a loan number. If you or Home Point ever need an official recommendation from us, you can count us in.”

I was amazed how quickly Chad was able to knocked out our refinance!
I highly recommend Chad he & his team did an incredible job! I had 3 others I was working with, including a Credit Union. Chad was able to offer me a lower rate with no fees! Based on the other 3 top financial bids I had for this refinance. ”

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I hope you enjoyed reading this article. It's my goal to keep you updated with the latest real estate mortgage news. I'm proud to provide you with 100% original and unique content. Subscribe now to get high quality real estate mortgage content and articles delivered directly to your inbox. Chad Baker is Regional Manager for RPM Mortgage. Chad is consistently recognized in the top 1% of mortgage originators in the United States 2011-2016. Got a question for Chad? Call (858) 353-8331 or submit your question online