Monthly payment calculator

What the quoted payment leaves out

When a lender quotes you "$3,100 a month," they almost always mean principal and interest, and that's only a piece of what you'll actually owe. Your real monthly obligation also includes property taxes, homeowner's insurance, mortgage insurance if you're above 80% loan-to-value, and HOA dues if the property has them. In the Portland metro that gap commonly runs $700 to $1,200 a month, which is enough to change which houses you should be looking at.

Portland-area defaults, and where they're wrong

The property tax rate above defaults to about 1.05%, which is a reasonable Portland-metro starting point, but Oregon's system is unusual and I wouldn't lean on that number too hard. Because of Measure 50, your taxes are based on an assessed value (a separate figure the county keeps, often well below what the house would sell for) that grows at a capped rate. So two houses sitting side by side on the same street can have very different tax bills. Pull the actual figure from the county assessor before you rely on it.

The insurance default of $1,800 a year has been moving fast, so get a real quote early. Insurance has become a live underwriting issue in a way it wasn't five years ago, and a surprise there can change your debt-to-income ratio late in the process, which is the worst time for it to happen.

About the mortgage insurance number

The 0.55% default is a middle-of-the-road conventional estimate. Your actual rate depends heavily on credit score and loan-to-value, and it can range from roughly 0.2% to well over 1%. FHA works differently again, because its annual premium usually lasts the life of the loan rather than dropping off at 78% the way conventional does. That one difference is worth more money than most of the rate comparisons people spend their evenings on.

Common questions

Does this include closing costs?

No. This is your recurring monthly payment, and closing costs are a separate one-time amount, typically 2–5% of the purchase price in Oregon. Some of that can be covered by the seller or rolled into the rate, so it isn't necessarily all cash you have to bring.

When does mortgage insurance go away?

On a conventional loan, automatically at 78% loan-to-value based on the original amortization schedule, and on request at 80%. FHA mortgage insurance generally stays for the life of the loan if you put less than 10% down, which is the whole reason people refinance out of FHA later.