Question 1

How is my monthly mortgage payment calculated?

Accepted Answer

Your monthly payment includes four components (PITI): Principal (the loan amount repayment), Interest (the cost of borrowing), Taxes (annual property tax divided by 12), and Insurance (homeowners insurance divided by 12). Our calculator breaks down each component so you can see exactly where your money goes.

Question 2

What interest rate should I use in the calculator?

Accepted Answer

For 2026, typical jumbo loan rates range from 6.50% to 7.25%. Use 6.75% as a starting point for a 30-year fixed jumbo loan. ARM rates start lower (around 6.00-6.50%) for the initial period. Your actual rate depends on credit score, down payment, loan amount, and market conditions.

Question 3

Does this calculator include PMI?

Accepted Answer

Our calculator includes a PMI toggle. If your down payment is less than 20%, PMI typically costs 0.3% to 1.5% of the loan amount annually. Many jumbo lenders offer ways to avoid PMI, such as piggyback loans (80/10/10) or lender-paid PMI built into the rate.

Question 4

How accurate is the amortization schedule?

Accepted Answer

The amortization schedule provides a highly accurate projection based on a standard fixed-rate loan calculation. Actual payments may vary slightly due to escrow adjustments, rate changes (for ARMs), or supplemental tax bills. The schedule shows how each payment is split between principal and interest over the life of the loan.

Question 5

What property tax rate should I use?

Accepted Answer

Property tax rates vary significantly by location. The national average is about 1.1% of assessed value. High-tax states like New Jersey (2.2%), Illinois (2.1%), and Texas (1.7%) are well above average. Low-tax states like Hawaii (0.3%), Alabama (0.4%), and Colorado (0.5%) are below. Check your county assessor website for exact rates.

Question 6

Can I compare two different loan scenarios?

Accepted Answer

Yes! Our comparison feature lets you evaluate two different scenarios side by side. Compare a 15-year vs 30-year term, fixed vs ARM rates, or different down payment amounts to see how each option affects your monthly payment and total interest paid over the life of the loan.

Question 7

What is the difference between interest rate and APR?

Accepted Answer

The interest rate is the cost of borrowing the principal loan amount. The APR (Annual Percentage Rate) includes the interest rate plus other costs such as origination fees, discount points, and closing costs, expressed as an annual rate. APR gives a more complete picture of total borrowing costs.

Question 8

How does loan term affect my payment?

Accepted Answer

Shorter terms (15 or 20 years) have higher monthly payments but significantly lower total interest. A $1M jumbo loan at 6.75% costs about $6,488/month over 30 years ($1,335,723 total interest) vs $8,851/month over 15 years ($593,120 total interest). You save over $742,000 in interest with the shorter term.

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