How to calculate mortgage payments
Your monthly mortgage payment will include more than just principal and interest payment. You can crunch some number but keep in mind you will have additional costs such as Homeowners Insurance and Property Taxes. In some cases, you may have additional cases such as Homeowners Association dues (typically paid seperatly by the homeowner and not part of your Escrow Account), flood insurance for homes in a flood zone as declared by FEMA, additional Fire Coverage for High Fire areas, and other special assessements.
For loans that have less than 20% down payment, or for FHA or USDA loans, your loan will be subject to private mortgage insurance (PMI) which will be added to your monthly mortgage payment. For convnetional loans, you can Buy Out the monthly mortgage insurance for an up front fee.
Property tax rates are different from state to state and even city to city. State of California charges a flat 1% tax rate. Older areas that have been built 50 years ago as an example, will have very few additional taxes. These additional taxes might include paying for your local Schools. Newer homes have higher tax rates. Buying a home in an area with a lower property tax rate may make it easier for you to afford a higher-priced home but the area is also more desirable.
If you purchase a home with all Cash and you own it free and clear, you have the option of getting homeowners insurance. It is strongly recommneded to have the insurance in case of fires and other natural disasters. If you have a loan against the house, your lender will always require you to have homeowners insurance and will also ensure that there’s enough coverage to rebuild the home or payoff the loan.