FHA Loan Calculator.

An FHA loan amortization schedule breaks down how your monthly payments are applied to the loan’s principal and interest over time. Initially, most of your payment goes toward interest, but as the loan progresses, more of it will go toward reducing the principal.

If you want to build equity faster, you can make additional payments directly to the principal. However, check with your lender before making extra payments to ensure they are applied correctly.

Use Kassa’s loan amortization calculator to see how your monthly FHA loan payments work and explore the benefits of making extra payments.

FHA loans require that your monthly mortgage payment is no more than 31% of your gross monthly income (before taxes). For example, if your household earns $75,000 annually, your monthly FHA loan payment should not exceed $1,937.50.

Additionally, the FHA looks at your total debt, including car loans and student loans. Your debt-to-income ratio (DTI), which compares your monthly debt payments to your income, can be up to 43%. This limit can be higher if you have “compensating factors” like significant savings, a higher mortgage payment, or residual income.

Use our FHA loan calculator to see if your potential home fits within these payment limits. Remember, just because you qualify for a specific loan amount doesn’t mean you should borrow the maximum. Choose a payment that comfortably fits your budget, considering additional costs like utilities and maintenance.

An FHA loan amortization schedule breaks down how your monthly payments are applied to the loan’s principal and interest over time. Initially, most of your payment goes toward interest, but as the loan progresses, more of it will go toward reducing the principal.

If you want to build equity faster, you can make additional payments directly to the principal. However, check with your lender before making extra payments to ensure they are applied correctly.

Use Kassa’s loan amortization calculator to see how your monthly FHA loan payments work and explore the benefits of making extra payments.

FHA loans, insured by the Federal Housing Administration, allow lenders to offer home loans with low down payments to those with lower credit scores. They’re especially popular for first-time homebuyers.

With our FHA loan calculator, you can estimate your monthly payment. The results are based on factors like the cost of the home, your down payment, and other common costs and fees. Keep in mind, actual costs may vary depending on your lender.

Here’s what you’ll need for the calculator:

Cost of the Home: Start with the sales price of the home you’re considering. If you’re still shopping, enter estimates within your price range.

Down Payment: Enter the amount of cash you can pay upfront. FHA loans require at least 3.5% down if your credit score is 580 or above. Scores between 500 and 579 require a minimum 10% down.

Loan Amount: This is the difference between the home price and your down payment. FHA loans have maximum loan amounts that vary by location. Check your area’s limits.

Estimated Interest Rate: This is what you pay the lender for borrowing money. Rates vary by lender and depend on factors like your credit score and loan term. Higher credit scores typically mean lower rates. Shop around to find the best rate.

Life of the Loan: The term of your loan in years. FHA loans usually have a maximum term of 30 years, but you can choose shorter terms like 15 years. Shorter terms mean higher monthly payments but less interest over time.

Property Taxes: Local and state governments charge property taxes based on your property’s value. These are usually paid through an escrow account.

Homeowners Insurance: Required by lenders, this insurance covers damage from events like fires or burglaries. This cost is also part of your escrow account.

HOA Fees: If your home is in a subdivision or condo community, you’ll need to pay regular homeowners association dues.

Use our FHA loan calculator to get a better idea of what your monthly payments could be, and remember to consider all these factors when planning your budget.

First-time homebuyers often overlook the various costs involved in homeownership. Here’s what makes up your monthly FHA loan payment:

• Principal: This is the loan amount minus your down payment. For example, a $240,000 house with a 10% down payment has a principal of $216,000.
• Interest Rate: The annual rate charged by the lender for borrowing the loan. For a $240,000 loan at 5.5%, you’d pay $13,200 in interest the first year (0.055 x 240,000 = 13,200). Rates vary by lender.
• Property Tax: Taxes charged by federal, state, local, or municipal authorities. These are divided into 12 installments and added to your monthly mortgage payment.
• FHA Mortgage Insurance Premiums: FHA loans require mortgage insurance, which includes an upfront premium due at closing and ongoing premiums added to your monthly payments.
• Homeowners Association (HOA) Fees: If your home is part of an HOA, there will be a monthly or annual fee for neighborhood improvements and maintenance.

If your FHA loan payment is higher than you’d like, here are a few tips to reduce it:

• Extend the Loan Term: Opt for a 30-year loan instead of a 15-year one to lower your monthly payments, though you’ll pay more interest over time.
• Avoid Extended MIP Payments: If you put down at least 10%, you only need to pay mortgage insurance premiums (MIP) for 11 years.
• Increase Your Down Payment: A larger down payment reduces your loan amount and lowers your monthly payment.
• Shop Around for Rates: Compare FHA lenders to find the best interest rates. Different lenders have varying requirements and rates, so do your homework.