Mortgage APR Calculator - Calculate Real APR with PMI, Points & Fees
Mortgage APR Calculator
Mortgage APR Calculation Results
Payment Schedule Visualization
Monthly Payment Amortization Table
| Month | Beginning Balance | Interest | Principal | Ending balance |
|---|
How to Use This Calculator
- Enter Basic Loan Information: Input your home price, down payment, interest rate, and loan term.
- Add Fee Details: Include any loaned fees, mortgage points, and PMI information.
- Review Results: The calculator provides your real APR, monthly payments, and total costs.
- Analyze Visualizations: Use the pie chart to see cost breakdown and the line chart to understand payment progression.
- Export Data: Download the amortization schedule for your records.
Tips for Accurate Results:
- Include all known fees and points in your calculation
- Verify PMI requirements with your lender
- Consider both percentage and dollar-based PMI calculations
- Remember that PMI typically ends when you reach 20% equity
Understanding the Results
Real APR: This is your true annual cost including all fees and PMI. Use this to compare different loan offers.
Monthly Payment: Your base principal and interest payment, excluding PMI and escrow.
Total Monthly Payment: Includes PMI when applicable, giving you the complete monthly obligation.
Amount Due at Signing: Total upfront costs including down payment, points, and fees.
Understanding Mortgage APR: A Comprehensive Guide
What is APR (Annual Percentage Rate)?
The Annual Percentage Rate (APR) represents the total yearly cost of your mortgage, including not just the interest rate, but also additional fees and costs associated with obtaining the loan. Unlike the simple interest rate, APR provides a more complete picture of what you'll actually pay for your mortgage.
The APR includes:
- Base interest rate
- Mortgage points (discount points)
- Origination fees
- Private Mortgage Insurance (PMI)
- Processing fees
- Underwriting fees
- Other closing costs that are financed
APR Calculation Formula
The APR calculation uses the present value formula to find the rate that makes the present value of all payments equal to the loan amount minus upfront fees:
Where:
- Net Loan Amount = Loan Principal - Upfront Fees
- Monthly Payment = Principal + Interest + PMI (when applicable)
- Monthly APR = Annual APR / 12
- n = Payment number (1 to total number of payments)
PMI (Private Mortgage Insurance) Impact
PMI is typically required when your down payment is less than 20% of the home's purchase price. Our calculator accurately accounts for PMI by:
- Calculating monthly PMI payments based on the loan-to-value ratio
- Determining when PMI can be removed (usually when LTV reaches 80%)
- Including PMI payments in the APR calculation for the months it applies
- Showing the total cost of PMI over the life of the payments
References and Additional Resources
Government Resources:
- Consumer Financial Protection Bureau (CFPB) - APR vs Interest Rate
- U.S. Department of Housing and Urban Development - Home Buying
- Federal Housing Finance Agency - Mortgage Information
- VA.gov - Home Loans
- USDA.gov - Rural Development Loans
Regulatory Information:
Educational Resources:
- MyMoney.gov - Home and Mortgage
- Federal Trade Commission Consumer Information on Mortgages
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