Key Factors for Using a Texas Mortgage Calculator
Are you looking to buy a new home in Texas or refinance an existing loan? Or are you just interested in finding a top Texas mortgage calculator to estimate the mortgage amount that best fits your budget?
Depending on your reasons, a Texas based mortgage calculator allows you to:
- Estimate the mortgage amount that best fits your financial situation
- Estimate what your monthly mortgage payment will be, and whether you can afford to pay that month and still pay for your other monthly expenses
- Determine APR rates and APR fees
- Determine the interest rate that you’ll have to pay on a mortgage loan
Conventional vs Adjustable Rate Mortgages
Lenders that provide mortgages provide a wide range of conventional and adjustable rate loan types, including those listed below.
Conventional mortgages include:
- 10-year mortgage loans
- 15-year mortgage loans
- 20-year mortgage loans
- 30-year mortgage loans
A conventional mortgage is a loan that has a fixed-interest rate that won’t change throughout the life of the loan.
These types of mortgage rates conform to established industry and regulatory guidelines based on size of the loan and your financial situation. Terms for conventional mortgages typically range between 10 to 30 years.
Conversely, adjustable rate mortgages will have fluctuating interest rates, meaning that if the real estate market begins to offer more favorable rates, so will your mortgage.
With typically shorter terms and the opportunity to get better mortgage rates over time, these types of loans are popular options for homeowners looking to refinance existing mortgages.
Adjustable rate mortgages include:
- 5/1 ARM
- 7/1 ARM
- 3/1 ARM
Getting Better Mortgage Rates with Larger Down Payments
Although some mortgage lenders require a down payment of 3 percent, the best way to secure better rates is to put down at least 20 percent of the home’s value.
Along with getting more favorable mortgage rates, a higher down payment means that you can avoid paying extra for private mortgage insurance (PMI).
Mortgage lenders require the purchase of mortgage insurance for smaller down payments to protect their investments in case borrowers stop making payments.
Typically, borrowers must continue paying until they reach a loan-to-value ratio of 80 percent. While it may not help you cut down costs over the long-term, it certainly does provide short-term affordability for a mortgage.
According to Zillow, the average premium for PMI ranges between $30-$70 for every $100,000 borrowed, which could make it an affordable compromise for borrowers that can’t put down the full 20 percent.
Conclusion: Texas Mortgage Calculator | Calculate Texas Home Loans, Mortgage Payments, Rates, & APRs
Making the decision to take on a mortgage for a house in Texas is a very exciting, and probably one of the scariest financial decisions that you will make. The idea of indebting yourself for the next 15-30 years isn’t an easy pill to swallow, especially considering the uncertainty of these economic times.
However, owning your own Texas home is also one of the soundest economic investments one can make. A Texas mortgage calculator or a Texas “mortgage rate and payment calculator” is a simple online tool that can help you better understand the financial implications of taking on a mortgage.
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