Mortgage Calculators

Clarity’s calculator can help you decide:

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The loan length that's right for you: If your budget is fixed, a 30-year fixed-rate mortgage is probably the right call. These loans come with lower monthly payments, although you'll pay more interest during the course of the loan. If you have some room in your budget, a 15-year fixed-rate mortgage reduces the total interest you'll pay, but your monthly payment will be higher.

If an ARM is a good option: As rates rise, it might be tempting to choose an adjustable-rate mortgage (ARM). Initial rates for ARMs are typically lower than those for their conventional counterparts. A 5/6 ARM — which carries a fixed rate for five years, then adjusts every six months — might be the right choice if you plan to stay in your home for just a few years. However, pay close attention to how much your monthly mortgage payment can change when the introductory rate expires.

If you're spending more than you can afford: The calculator provides an overview of how much you can expect to pay each month, including taxes and insurance.

How much to put down: While 20 percent is thought of as the standard down payment, it's not required. Many borrowers put down as little as 3 percent.

How mortgage rate changes affect your budget: Small moves in rates can make or break your monthly spending goals.

Alternative uses of Clarity’s mortgage calculator

Most of us use a mortgage calculator to estimate the payment on a new loan, but it can be used for other purposes, too, including:

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Planning to pay off your mortgage early: Use the "Extra payments" function to find out how you can shorten your term and save more money with additional payments. To calculate the savings, click the "Amortization” tab and enter an amount into one of the payment categories (monthly, yearly or one-time).

Deciding if an ARM is worth the risk: While an ARM might be appropriate for some borrowers, others might find that the lower initial interest rate won't cut their monthly payments as much as they think. To get an idea of how much you'll really save at the outset, enter the ARM’s introductory rate into the mortgage calculator, leaving the term set to 30 years. Then, compare those payments to the payments you get when you enter the rate for a 30-year fixed mortgage.

Finding out when to get rid of private mortgage insurance (PMI): You can use the mortgage calculator to determine how much you’ve paid down your balance at various points in the repayment schedule, including the all-important 20 percent equity mark. That's the magic number for removing PMI premiums. Simply enter in the original amount of your mortgage and the date you closed, and click "Show Amortization Schedule." Then, multiply your original mortgage amount by 0.8 and match the result to the closest number on the far-right column of the amortization table to find out when you'll reach 20 percent equity.

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How to lower your monthly mortgage payment

If the monthly payment you're seeing in our calculator looks a bit out of reach, you can try some tactics to reduce the hit. Play with a few of these variables:

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Choose a longer loan. With a longer term, your payment will be lower (but you'll pay more interest over the life of the loan).

Spend less on the home. Borrowing less translates to a smaller monthly mortgage payment.

Avoid PMI.  A down payment of 20 percent or more (or in the case of a refi, 20 percent equity or more) gets you off the hook for PMI.

Shop for a lower interest rate. Be aware, though, that some super-low rates require you to pay points, an upfront cost. Clarity Home Lending is clear and upfront with all of our fees, points, pricing, etc 

Make a bigger down payment. This is another way to reduce the size of the loan.

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