TO CALCULATE YOUR MONTHLY PAYMENT AND MONTHLY COST
(example) (your figures)
price of the home . . . . . . . . . . . $ 50,000 $
amount financed . . . . . . . . . . . .$ 40,000 $ (80% of price is typically financed)
PAYMENT PER MONTH
Use chart #2. Find the interest rate and number of years financed. The number you find for those coordinates is the monthly payment for each one thousand dollars financed. For example, at an interest rate of 8% for 20 years your payment is $8.37 per thousand per month. If you are financing $40,000 multiply 40 times $8.37 and your payment is $334.80 per month.
MONTHLY HOUSE PAYMENT COST
Payment . . . . . . . . . . . . . . . . . . $ 334.80 $
Interest portion . . . . . $ 266.67 $ (interest rate times amount financed divided by 12) (40,000 x 0.08) divided by 12
tax rate time interest portion . $ -75.47 $ (28% assumed, your tax rate may be different)
Monthly property tax . . . . . . . . $ - 14.00 $ (if taxes are $600 per year divide the taxes by 12 and take it times your tax rate 28% assumed. Yours may be different)
Monthly cost . . . . . . . . . . . . . . . $ 245.33 ** $
* The federal government allows you to deduct mortgage interest and taxes on your home. This is a great savings for the millions of home owners who itemize their deductions. This example gives you what your real monthly cost would be if you itemized your deductions.
** each month the interest portion goes down a little and the principal portion goes up a little.
CHART # 1 percentage of monthly income
|
gross yearly income |
28% | 33% | 36% |
| $10,000 | $233 | $275 | $300 |
| $15,000 | $350 | $413 | $450 |
| $20,000 | $467 | $550 | $600 |
| $25,000 | $583 | $688 | $750 |
| $30,000 | $700 | $825 | $900 |
| $35,000 | $817 | $963 | $1,050 |
| $40,000 | $933 | $1,100 | $1,200 |
| $45,000 | $1,050 | $1,238 | $1,350 |
| $50,000 | $1,167 | $1,375 | $1,500 |
| $55,000 | $1,283 | $1,513 | $1,650 |
| $60,000 | $1,400 | $1,650 | $1,800 |
| $65,000 | $1,517 | $1,788 | $1,950 |
| $70,000 | $1,633 | $1,925 | $2,100 |
| $75,000 | $1,750 | $2,063 | $2,250 |
| $80,000 | $1,867 | $2,200 | $2,400 |
| $85,000 | $1,983 | $2,338 | $2,550 |
| $90,000 | $2,100 | $2,475 | $2,700 |
| $100,000 | $2,333 | $2,750 | $3,000 |
CHART #2 -- Monthly payment of principal & interest -- (dollars per month for each $1,000 borrowed)
| interest rate | 15 yr | 20 yr | 30 yr |
| 6.0 | 8.44 | 7.16 | 6.00 |
| 6.5 | 8.71 | 7.46 | 6.32 |
| 7.0 | 8.99 | 7.76 | 6.65 |
| 7.5 | 9.28 | 8.06 | 6.99 |
| 8.0 | 9.56 | 8.37 | 7.34 |
| 8.5 | 9.85 | 8.68 | 7.69 |
| 9.0 | 10.15 | 9.00 | 8.05 |
| 9.5 | 10.45 | 9.33 | 8.41 |
| 10.0 | 10.75 | 9.66 | 8.78 |
| 10.5 | 11.06 | 9.99 | 9.15 |
| 11.0 | 11.37 | 10.33 | 9.52 |
| 11.5 | 11.69 | 10.67 | 9.90 |
| 12.0 | 12.01 | 11.02 | 10.29 |
